Option 2 is not tax effective. You would be way better off paying the $150,000 into your home loan and redrawing it, converting it in to deductible debt while reducing the non-d debt.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

have a look at http://www.lawcentral.com.au they have an agreement available there for people buying property together. You can register for free and get access to all of the tips.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

Your accountant’s fees sound reasonable

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

Just ask you accountant to draw up a loan agreement.

For the lease, you just need to purchase one for about $25 and get them to sign it. You might like to get a letter from an agent confirming market rent – this will prove you are not under charging relatives.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

Yes you will be require to declare your worldwide income to the ATO. But due to the double tax agreements, you should not have to pay tax twice, and will therefore get a rebate for tax paid overseas. It will be a pain in the butt trying to work out how to fill in the tax return etc.

Terryw
Discover Home Loans
Mortgage Broker
North…[Read more]

Just ask them to lend you the deposit. It is called Vendor financing. You work out an agreement, eg you pay interest only at 12% for $50,000 over a 5 year term. Then leave it up to your solicitor.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

I think you shouldn’t have too much trouble, same employer etc.

I’ve put someone through ANZ like this and was OK.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

Thanks OSS.

I was thinking of doing a Dip Fin Planning and was looking at Tribecca. thanks for the info.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

Cath

if that is the case, maybe your father could buy the property in his name and you have a separate agreement concerning costs etc.

If you go on title, then your income and situation will have to be taken into account by the lender. It still may be possible however.

Terryw
Discover Home Loans
Mortgage Broker
North…[Read more]

OSS

Thanks for your detailed reply. These are certainly worth looking at.

May I ask you about your financial planning course? Where are you studying and what you think about it?

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

Good trust deeds can be setup for about $257 at http://www.lawcentral.com.au

The solicitor there is Brett Davies who is doing his Ph.D. in asset protection.

But if you want some advice etc, it may be better to get an accountant/lawyer to set one up for you. To do this it usually costs $1000 at least for the trust and then another $1000 or so for the…[Read more]

oakley is correct. If you told the bank you wanted to leave your job to start a business, then it will be very hard.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

Hi Reggie

I don’t know much about this area, but think if properly setup superfunds can lend money for property purchase. there are various rules that prevent the fund lending money to relatives, etc of the trustees etc.

Flipping properties in a superfund shouldn’t be a problem, superfunds only pay 10% CGT. But they may be just classed as…[Read more]

There are very few that lend to 90% on a low doc basis, and they all have high exit fees.

If 80% would do, you could try BankWest. The last time I looked they only charged about $300. You will be up for LMI though.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

Yes I agree with Monopoly.I was reading the Taxpayers guide last night, and they claim that money from boarders is not counted as income for tax purposes. Therefore I would say that your property would only be classed as an IP from the date you rented it out. You then have 6 years from this date where you can still claim it as your main residence…[Read more]

Yes you can claim the interest. You probably should have a written loan agreement in case of audit.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

You could do that, but the interest would not be deductible. The ATO looks at the purpose of hte funds, in this case it would be to pay non deductible debt.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

I have been meaning to look into testamentary trusts too for a while, but never get around to it.

They are a very good method of willing assets away. There are various tax advantages such as Children being able to receive funds and pay adult tax rates, instead of the penalty rates for kids (up to 67%).

Also from an asset protection point of view…[Read more]

As an aside, I have seen at least two clients who have hybrid trusts with the loan in the trustee’s name – a company. It appears that not everyone that has one understands how the work and how they should be used.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhomeloans.com.au

Since its your dad, why not start simple and just buy a property jointly. However, you should agree at the begining on who does what, and how much each of you will put in etc. Look at the what ifs – ie if either of you wants out, what do you do, sell, buy out the other partner, bring in a new partner etc. It is best to write these things…[Read more]