Mike

I thought we were talking about changing trustees? If the sole director of the trustee company is the previous trustee, then there should not be any change in beneficiaries – alto the new company would itself be a beneficiary.

There are some interesting articles on trusts available at:
http://www.taxlawyers.com.au/Publications

Including…[Read more]

I used them for some advise and set up of a trust years ago and found them to be quiet good. I dealt with Bruce Whitting himself, and the cost was much cheaper then. Now they seem to have many consultants available and the cost has gone up considerably.

If you are planning to go in, be prepared before hand otherwise you won’t get your money’s…[Read more]

Aussie mike, are you sure about this. I have asked Trust guru Dale GG about this in the past and he seemed to think it could be done without paying stamp duty and was a matter of filling in some forms indicating a change of trustee.

Sebastian, it may also trigger a CGT event if there is a change in beneficiaries etc so it is best to get some…[Read more]

James

generally it is the same serviceability with full docs and low docs. No Docs are good because you do not need to list an income.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

Nathan, Some answers:

1) Yes and no. The tenants could argue that this is a favourable purchase as they have an option on the property. If the LVR is less than 80% they should be able to get finance based on valuation at the time of cashout, not what they are paying – provided they have the income to service. On higher LVRs than this the mortgage…[Read more]

LifeX

To make your borrowing power stretch further, consider having one trustee per trust. So you buy the property fully in trust A, you partner then buys another property in Trust B, you both can be beneficiaries of each trust, could be a unit trust with units owned by each of your discretionary trust. This way only one of you would be…[Read more]

It is generally around 70 to 75% LVR, but you may be able to get 80% using a second mortgage.

Citibank have a good product where they will assess the application on the rental income only of the property.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

Hi

I’m with John. Why sell? You would lose too much. Just because it is not positive cashflow does not mean it is a dud. Hopefully it will quickly grow in value, being near the beach.

Building another unit on the block would be a good option if it is doable.

You can do lease options in SA if structured correctly.

Terryw
Discover Home…[Read more]

You could just apply for a release of security with your existing lender so that you home is not used as additional security for your IP (crossed securitised). The LVR is nearly 80% at the moment.

Then, you could borrow up to 80% of your home, using a LOC or redraw etc. This would release another $170,000 approx. which could then be used as…[Read more]

Earlier on in the year, the ATO was talking about stopping ‘the refinancing principle’. This is where a trust borrows to payback a trustee and claims the interest on the loan no matter what the trustee uses the money for.

Even if they do this, trusts will still be very beneficial.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

If you change trustees, you must notify the lender and the new trustee will more than likely have to fill in a new application and provide a guarrantee. Most mortgage contracts prohibit changing trustees of the trust in anyway without the lenders permission.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

Also look at having only one trustee. This could enhance borrowing capacity (especially in the use of low doc loans) and limit risk. You could have two trusts, one person a trustee of each.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

I rang the 1800 number listed on the advert and it sounded like the call was diverted overseas, and then was answered by an american sounding woman who took my details. Interesting!!

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

One of the best LOCs available is with ANZ at 6.47% for loans over $250,000. Macquarie Bank are 6.50% for over $300,000.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

Scott

I think you can now get margin loans on shares that you are writing covered calls on. ANZ from memory. But I agree with your point, you can not gear them anywhere near you can with property

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

Some lawyers just don’t understand and/or like wraps. But he does have a point in that the tile would not be in his clients name and therefore there would be some risk involved to his client.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

You can run a business thru a trust, but watch out for alienation of personal services income. If the ATO deems the money was earned by your own personal exertion, then the money will be taxed as if you earned it yourself. there are various rules you have to fulfill to avoid this.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

I am in the process of purchasing a business on ‘vendor finance’. ie part now, and then the rest in installments with a lump sum in the end.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

Pisces made a good point about the mortgage insurers only taking a limit number of apartments in any one project. There may also be problems with getting LMI depending on how many units are in the complex, but 90% lend on valuation is possible.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

Liz, Rob

I am willing to pass on their details, but am unable to find their card at present. Will ask around, please email me if I forget to get back to you.

From memory, the solicitor is located in Melbourne and they charge around $1000 to remove defaults etc. This is not so high when you consider the potential reduction in interest rates…[Read more]