I have a client who purchased there. The valuation report stated that prices had risen rapidly recently-due mainly to out of town investors and that there was a good chance of a price drop in the future. This was just the valuers comment, but valuation came in at purchase price.

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

What about trying for a credit card.

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

Hi Marc

The trouble with companies is they don’t get the 50% CGT discount for assets held over 12 months. Not many people buy and sell a property within 12 months, so most would qualify for the discount. So even if you were on the top tax rate of 48%, this would drop to 24%, beating company tax.

A better way would be to use a trust, and the…[Read more]

What state are you in?

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

Solicitors sometimes don’t understand how banks work. Bank’s will want a personal guarrantee from the trustee or the directors of the trustee company. So putting a friend or relative in as trustee probably wouldn’t be a good idea unless they are willing to give the guarrantees and sign various documents.

And then as you mentioned, this may effect…[Read more]

I beleive from a tax point of view, a sale is consider to occur when the contract is exchanged and is unconditional.

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

What about selling to a trust? that way you could ‘keep’ the property and release some money to pay off your home loan. Stamp duty and CGT may still be payable, but you would save on agent’s commissions.

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

I remember reading Dave’s plan. Since he is looking at cheap properties, coming up with the deposits shound’nt be too hard – $10,000 per property (plus costs). If you are a couple saving together, it would be easier. If one your own, it would be harder, but you could start off slower and speed up as you progress and all the rent comes flowing in.…[Read more]

I am not an accountant, but have wrapped myself and I have used a discretionary trust. Since you will be making positive cashflow, there is probably no need to use a hybrid trust, and I can see no point in using a unit trust (unless in partnership?).

Using a trust would not really have any effect on the end purchaser other than protetion of your…[Read more]

If you are going to reduce your work hours, permanent part time would be better as lenders view it as more stable. Also most lenders tend to worry about borrowers being too rental reliant – tho I have yet to hear a good definition of this. So it would be best to stay working full time as long as possible!

Terryw
Discover Home Loans
North…[Read more]

Bid

I have some clients who use Hybrid trusts and the banks have had no problems with the deals at all.

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

I think you may find that the agent will not have any ‘buyers’ until just before the 90 cotnract runs out.

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

I would probably spilt it up and do a number of different things such as shares and properties (using the capital as deposits), but maybe keep 10% for doing more riskying type investing such as share trading, investing in business etc.

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

Hi Dom

What about short term lending secured by caveats. rates are around 5 to 10% per month. I have done this, it is risky and scarey, but good money – $4000 to $8000 per month in your example of $80,000.

Also look at businesses. I have purchased a business returning 100% in year 1. (I’m not going to say what it is).

Terryw
Discover Home…[Read more]

I like the get it while you can concept.

It will be easier to qualify for LMI when starting out, so you might be better off stretching your deposits further.

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

Just think of as wrap as selling a house with a 30 year settlement, and the wrapper giving permission for the purchase to occupy the house while they give you the money in installments.

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

If you have the serviceability, you could borrow up to 90% of the value of your property and use that money for the business.

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

Yes banks will lend on this deal. They would have to know about it if the vendor was going to take out a second mortgage on the property. They would also want to factor in your repayments on the extra loan to the vendor (probably even if you had only one payment at the end).

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

In NSW you will have to pay land tax on all property held in a trust (and other states?) – ie you don’t have any tax free threshold. So you will be paying extra tax there, but may be saving tax elsewhere. I think the benefits outweigh the negatives.

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

Depending on the price, you may be able to go up to 95% lvr.

check out what one of the mortgage insurers will do at:
http://www.pmigroup.com.au/LocationWizard.asp

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