Powers of attorney cease operation at death!

Realistically how much of a property could you afford with such a deposit? Setting up the SMSF and bare trust could take a third of that money. Then you have hte lenders legal fees, stamp duty and conveyancing/legals. A deposit of at least 20% and probably 30% or even more for country towns would be needed too.The trustee of the fund would also…[Read more]

If it was the vendor then how is she going to sign the contract and the transfer?If someone is taking over the estate, have they been appointed by a court? ie Probate/letters of administration been granted?If not then they have no legal authority until their appointment. It doesn't matter what the will says because you won't know if it is the last…[Read more]

Hang on – who died?

Death maybe another!!!A vendor is more likely to die within 90 days then 30 days!What effect will this have on the sale? any special conditions.Insanity is another and so is bankruptcy and even divorce – what if the ex mistress lodges a caveat after your exchange?

What about the temporary absence provisions under the Land Tax Act (VIC)see s56http://www.austlii.edu.au/au/legis/vic/consol_act/lta200590/s56.html

In my opinion it would be unlikely that interest would be deductible  on any money borrowed and placed into an offset account and then later used for investment.

jaiterry wrote:
Now there is an interesting proposition… item C. I have a considerable amount of equity in my home (>50%). Perhaps there is a solution in there for my scenario. Regards jaiterry

But what would you be borrowing for? for the purchase of a new PPOR? if so then the interest wouldn't be deductible.

I am not sure what you can do. but you have to be careful as you could pay the builder a progress payment and then the builder go under without doing the work.You also have to be careful about supplies taking back goods which they have supplied the builder and they have not received payments for – the supplier will often retain title to goods…[Read more]

1. means the electricity commission may be exploring for petroleum on that land some time in the future!2. means s149 cert is not update in terms of zoning. How old is the s149 certificate included in the contract?

A SMSF cannot purchase from related parties. But one exception is business real property. This is defined to include leasehold property – ie the land with the building as being part of hte land. The SMSF couldn't buy hte building from a related party unless it is attached to the land.

Sometimes it may be necessary to pay down a loan.eg. imagine you have a $100,000 property with a $90,000 loan. Interest only. You also have an offset account and $50,000 in it.If you want to purchase an investment property what would you do?A. If you took the money from the offset then you would be increasing the non deductible interest on your…[Read more]

It would likely that the deductibel part of the loan would be much less than $274,000 – even if this was the lowest balance.This is demonstrated by a quick eg:$300,000 loan starting balance.pay down $1,000 per month PIInterest $500 each monthMonth 1balance is $299,500Month 2 $299,000etcThen after 10 months balance is $295,000.If you then pay the…[Read more]

Refinancing won't change things if it is contaminated. but you will be able to separate the portions and claim interest on what is left of the claimable portion.

jaiterry wrote:
Hi, My wife and I have only our PPOR which we plow all our savings into in order to reduce our interest. Initially (before knowing better) we made extra repayments into the homeloan but now we simply place additional funds into our mortgage offset account. The problem is we have been redrawing on and off for a while on the home…[Read more]

johnoj wrote:
I am intending to purchase my first of many investment properties in the near future and was hoping to get some advice regarding the best ownership structure. I understand the benefits of trust ownership for asset protection and tax minimization and am planning to use this structure to purchase properties. However how do trusts…[Read more]

your PPOR should only be security for the LOC (and original loan). The IP should be the only security for hte investment loan.You should not be paying the investment loan fortnightly as this would mean extra repayments – these should be going to the PPOR loan (not the loc) as this is non deductible.IO would revert to PI.Why is the loc interest…[Read more]

In that example the unit holder wouldn't be entitled to the 100% of the deductions on the interest because they are not entitled to 100% of hte income and CG of the trust.There is a good thread about htis topic on somersoft – started by Chris Batten.

u36ma wrote:
What I've taken from all this and my own research is:- Appropriate landlord insurance will take care of your risk of being sued by the tenant.- The HDT doesn't offer any legal tax benefits over and above having the properties under your own name.- There is a high cost of setting up and maintaining trusts with little personal…[Read more]

The company would be merely a beneficiary and any acts it does would be separate to the trust so it being sued shouldn't effect the trust – the units would be held by the individuals and at risk if they are sued.But, what are you trying to achieve? getting money into the trust with asset protection probably? To do that in this scenario you would…[Read more]