Hi

Having a discretionary trust provides good protection for the assets held in trust. However, having a trust does not help with borrowing any extra. Lenders do look at credit reports and take personal incomes into account in servicing.

Insurances are good to have, but they won’t always cover you. eg. The case about the person playing golf who…[Read more]

It would probably depend on what similar properties in the area are going for and what their yield is. Hard to estimate based on rent alone.

Terryw
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Terry@discoverhomeloans.com.au
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Hi CJ

FHOG is administered by the States. The ATO may have different criteria.

see
TD 51
Capital Gains: What factors are taken into account in determining whether or not a dwelling is a taxpayer’s sole or principal residence?
http://law.ato.gov.au/atolaw/view.htm?locid='CGD/TD51/NAT/ATO‘

Terryw
Discover Home…[Read more]

I think you ca get a good deed from a good accountant for around $1100 or online for around $600. Units can be issued at any time, I think, so if you bought another property, more units could be issued then – maybe a different class of units. The deeds are generally already made up, the accountant does not add clauses (as this would need to be…[Read more]

Hi Dave

I think the hybrids actually work more or less like a unit trust until there is enough growth to enable the units to be redeemed and from then on it reverts to the discretionary.

Each deed is different and the distributions etc have to be done in accordance with the deed, keeping in mind the tax regulations etc.

The ATO is looking at…[Read more]

Yes I have been looking at managed funds lately. Some have returned above 76% pa in the past year. Some have even returned 26% pa on average for the last 7 years.

I am begining to think these are better than property – no stamp duty, no land tax, good liquidity etc and you can margin lend some funds at around 50% LVR.

Terryw
Discover Home…[Read more]

Do a search on the ATO site under legal, and look for a tax ruling on main residence definition. I think you will find it lists the factors which determine whether a place is your main residence and this includes a number of factors. Time is not necessarily an issue.

Terryw
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Terry@discoverhomeloans.com.au
Send an email to get…[Read more]

Yes I would say it is very dangerous in setting up your own hybrid trust deed unless you know what you are doing. Spend $500 extra and get some peace of mind.

eg. how many units to issue, who will be unit holder, trustee, who to include as named beneficiaries etc.

Terryw
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Terry@discoverhomeloans.com.au
Send an email to get my…[Read more]

With hybrids you have to be careful. There are different opinions out there on distributions. Some believe that the income cannot be distributed freely, but must go to the unit holder to justify their claiming of interest against their personal income.

Maybe once the units are redeemed by the trust and it is acting as a discretionary trust then…[Read more]

Originally posted by DaveA:
Hey guys new to here but it seems a great place to help answer all those questions

Are banks/credit unions as acceptable in lending to an individual to purchase units in a trust to invest in property than they would be if the property was owned in the individuals name? Like can the bank still have a mortgage on the…[Read more]

Maybe your bank is the one starting with ‘N’, or even ‘C’ – they have been known to take more security than is needed.

Best to keep each property separate. 13 properties in together will be very messy to untangle. If you have equity you can always release some with No Doc loans. So best to leave some free to be used later on.

Terryw
Discover…[Read more]

I don’t think that is necessarily always true. Laws and procedures differ from state to state, so a NSW solicitor may be unfamiliar with the happenings down there in VIC. (But no doubt some based NSW solicitors would have been admitted in VIC)

Terryw
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Terry@discoverhomeloans.com.au
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Ownership = Names on the title. You can have 50/50 or some people have 99/1 with the 99% being in the name of the person with the highest income.

Some lenders also allow the title to be in one name but the loan in two names for married couples.

But think carefully before you sign on the dotted line. Short term thinking may save you a few hundred…[Read more]

Hi G

It won’t be easy to get a loan based on valuation as it is a transfer between related parties. In fact, I think it will probably be impossible as your original loan must have been 90% LVR.

Lenders are also aware of the drop in Sydney values, so even if you could find a lender that did not send a valuer out, they would still likely do a…[Read more]

What you should do is watch out for people who want to make money out of you. Be critical of any advice you receive.

If you are interested in property and renovations, you could buy a property, paying cash, then do it up and then mortgage it. Hopefully you will end up getting a higher value loan meaning less of your money is needed.

If you have…[Read more]

I have been writing a newsletter for about a year. Just send me an email to join. I’ve been a bit slack, and busy, the next one is due out now and I am still writing it.

Terryw
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Terry@discoverhomeloans.com.au
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I don’t think it matters where you have been living, as long as you qualify and intend to live in the property you are purchasing.

Terryw
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Terry@discoverhomeloans.com.au
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If the other party doesn’t have your signature, they cannot enforce the contract – this applies only to land. Whether you have their contract is irrelevant they can still have a binding contract if they have yours. check with your solicitor.

Terryw
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Terry@discoverhomeloans.com.au
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The lenders that allow loans without valuations have a few conditions including:
– must be a sale using a registered real estate agent
– must be between two unrelated parties
– they may do a price estimate using RP data or similar

so if you are thinking of selling your $200,000 property to your company for $400,000 and getting a loan of $320,000…[Read more]

To place a caveat over property, I believe you have to have some sort of interest in the property. Being a director and former trustee and a beneficiary of the trust that owns the shares in the company that owns the land should be enough.

So just go to the land titles office in your state and fill in the short forms. Shouldn’t be too hard to do…[Read more]