And don’t forget stamp duty!

Terryw
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Just make sure your buyer can settle on the same day as you, or you will be in need of a loan to settle.

Terryw
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Hi Adam

You would probably be better of paying you PPOR home loan down asap, then reborrow to use as deposits on futher investment properties (or shares etc).

Terryw
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On the tax side of things, look out for CGT. you may be able to reduce it a bit by delaying exchange to July 1 so it comes into the new financial year, so you will have another year before you have to pay the tax, and can therefore plan more for it.

Terryw
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If you have $80K in the bank and a PPOR with a loan against it, you would probably be better to pay this loan down to reduce your ‘bad’ debt. Then you can reborrow this money (making it good debt) and use as deposits for more property.

Terryw
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I am interested in why you say “(I have seen the errors of much past life..)”. It seems like you have done well!

You seem to have lots of equity, so if you are working you should be able to buy a few more properties – possibly several.

Terryw
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Clive

Worse case scenario, if you don’t have any ‘poor’ relatives is to set up a company and distribute to that. Companies pay 30% tax. Then money will be stuck in the company, but it could then be loaned or invested etc. (make sure you do htis properly)

Terryw
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ANZ will do low doc loans virtually anywhere in Aust without mortgage insurance with an LVR up to 65%. (Won’t do for companiens or trusts under low doc tho).

Terryw
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Once you run out of deposit money, you need to either save, wait for growth, or both. Or you could get creative…

Terryw
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If the student in not working then the course cannot be related to current employment, therefore they could not claim this.

Terryw
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You would have to charge market rent. If the ATO audited you, it would be good if you could prove this via clippings from the for rent sections in newspapers, agents letters estimating rent etc. (just ask them to estimate on the low side).

Terryw
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It is very hard to find wrap friendly finance. So Give the Mortgageman a call and see what he has to offer.

Terryw
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I would never manager my properties either. I think i would find it too hard to put up the rent once you get to know the tenants – which you would, as they would be ringing you a fair bit.

Terryw
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Have a look at the recent post on ‘flipping’

Terryw
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Hopefully by the time you sell your house, the new property will have gone up enough for you to ‘repay’ the 20% securred against to be paid back with money fully securred against the investment property.

Terryw
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I agree with Mick

You can shift it, but can’t claim it. Unless,,,,

You sell the property to your trust, or if owned by you and spouse, one of you buys the other out, borrowing money to do so with the proceeds going into the PPOR loan. But there may be CGT and stamp duty payable.

Terryw
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Click…[Read more]

Louise

Thanks for posting that, it looks good.

BTW, The cost is $2200 or $500 per session (day long?)

Terryw
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You shouldn’t use a company unless it is as trustee for a trust. You lose too much CGT otherwise.

The main advantage in using a trust for your PPOR is asset protection. For tax reasons, you would save a bit early on, but in the long run you would be up for tax on the rent when it becomes positively geared (which it will as rents increase) and…[Read more]

It can get complicated at tax time when working out interest portions. Have you looked at a Tax Ruling that covers poritoning of interest?
eg. TR 2000/2. Income tax: deductibility of interest on moneys drawn down under line of credit facilities and redraw facilities

Terryw
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So you mum paid cash for her half by borrowing against her home.
If you increase the loan, that is fine, but if you default for any reason, then they will come after either one or both of you to make the repayments, if you can’t and mum can’t and you have no other assets then your mum’s home may be at risk, even though it is not used as…[Read more]