Hi Karlm

Sounds like you are putting all your money into the LOC which was used to fund the deposit for the investment property. If this, this is not very good. You are mxing investment and personal money in the one account so apportioning interest at tax time will be hard. Worse, every $1 you put in you are reducing the deductibility of interest…[Read more]

Have you looked on ebay?

Terryw
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Yes, but remember paying off debt is different to paying expenses and the trust may still make a profit which will have to be distributed.

Its just like yourself owning a property with a loan and earning $30,000 per year. If you paid off $30,000 in debt your income would still be $30,000 and you would have to pay tax accordingly.

Terryw
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Trustees can be changed easily, but just remember if the trust owns assets there will be a lot of paperwork – titles will need to be changed (the trustee is the legal owner) and loans will need to be changed into the new trustees names.

Terryw
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CT

You are talking about hybrid trusts. With these the person borrows money to buy the units in the trust, not the property.

Terryw
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Its all up to you. Just bear in mind the loan will have to be in the name of the person on title. If both on title, then both on the loan.

You can have an agreement drawn up to cover the deposit – this is essentially a trust arrangement.

Terryw
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Woodo

Keep you loan as is and get another loan as a LOC secured against your home. This loan can be used as deposits so your new IP loans can be stand alone – ie not cross collateralised.

Terryw
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You should consider buying an owner occupied home as you are considering, and then using the equity for further investments. If you intend on renting this out, and using the 6 year CGT rule, then it would be good to look at a IO loan with a 100% offset account attached. Maybe get as large a loan as possible and place excess funds in the…[Read more]

Hi Pos

Someone else has recently asked me a similar question – might have been you?

With a hybrid trust you do not borrow and lend to the trust. You (or one of you – the hughest income earner usually), you borrow from the bank to buy units in the trust. So the trust sells you the units. The security for the loan is the trust property.

If you…[Read more]

Look up the tenants union victoria – they are for tenants but offer a lot of informaion on how to evict someone. Think you should get them out asap.

Terryw
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I think CJ’s example would be fine – but check with your accoutant. As far as I know the six year rule starts again ocne you have moved in. So you could rent it out for 5 years, move in for a short period, and move out and rent it for another 5.9 years and just keep on doing this. As long as you are not abscent for mor than 6 years in a row, then…[Read more]

I think you should keep any investing and any business in a separate entitly. Business is a dangerous game, many get sued and go under. If you had your huses in there with a business, then they would be at risk.

With property you would generally want a discretionary trust or a hybrid discretionary trust to allow negative gearing. Business would…[Read more]

St George is very good with hybrids as are Mqcquarie. Bankwest can be good in some circumstances, but they usually want too many guarrantees. ANZ – it depends on who you get assing the loan there.

Terryw
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Hi

I am not a lawyer, but will offer the following comments

1). Not sure. If the trust is sued, eg. by a tenant, then it can certainly lose its assets. The benefits are more for the portection if an individual sued, the individual doesn’t own the trust assets.

2) You may be cover by insurance in most instances, but not all. eg. there is one…[Read more]

If a bank foreclosed, they will have a judgement on the owner for a certain amount. If they sell and their is money left over, this goes to the borrower. If there is a shortfall then they will go for further legal action to recover the extra amount (including costs), they may then be able to sell further property, garnish wages, or maybe even…[Read more]

Originally posted by L.A Aussie:
I am not sure, but I think that unless there is an income from an investment you can’t make a claim for a tax deduction. This is probably why there are no tax deductions on vacant land that has no income I suspect.

Marc

You can certainly claim interest on vacant land – in certain circumstances. But I think you…[Read more]

Which state are you in?

In mosts states you will have to issue a notice to vacate, if they don’t leave then you can evict them – with a court order. You can also get an order for money owed and maybe go after them a few years later when they are working and back on their feet again.

Terryw
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Terry@discoverhomeloans.com.au
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I am not a client, but would recomend Richard. He certainly knows a lot about property – which is very rare for a fin planner.

Terryw
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You may not go broke making a profit, but you may be able to do a lot better.

This is not a small unit is it?

If there is no CG potential, then I cannot see the point in buying such a property. making $50 (eg.) per week for 100 years may not be worth the effort. Think about the effect a rate rise or a major repair will have. Also think of the…[Read more]

I have 101 and the kids one. Hven’t played them much because of the time it takes, and lack of willing partners. They are pretty expensive games and are very americanised.

Terryw
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