If it is a separate loan, the loc, then that is good. You must have equity to do this then

Good that they have a license too.

But who is the lender? 6.6% is very high at the moment. I hope the main loan isn't a LOC.

Not sure about the fees being deductible up front. Seek your own tax advice.

i would be concerned that it is not tax effective.

You would probably be effectively paying cash for an investment. If you could instead pay all the loan amount off the loan and then borrow the extra money to invest into the same share investments then you would be paying off the non deductible home loan faster.

The 'Gap protection' will probably involve the purchase of an option so there will be fees for this too.

Get a valuation done. Agent's listing price usually doesn't bear any relationship to value

You can refinance a SMSF loan, but St George is a good one as you don't have to provide a personal guarantee.

See Special Purpose companies
http://www.asic.gov.au/asic/asic.nsf/byheadline/Special+purpose+companies?openDocument

Annual fee is a mere $43
http://www.asic.gov.au/asic/asic.nsf/byheadline/Schedules+of+corporations+fees?openDocument

Actually, you are asking about the custodian trustee aren't you. Now I am not sure if these could be special purpose companies. But a call to ASIC would set you straight.

I was just going to suggest a trust structure too – should at least consider it.

In some states the transfer of units in a unit trust are not subject to duty. In NSW the rate of duty is currently 0.6% but it will be abolished from 01 July 2013.

That means that 2 people buying property together could purchase in a unit trust structure and when one wants out the other can buy the units and no stamp duty would be payable from 1 July next year in NSW. The legal owner of the property would be the trustee and need not change – ie no change in land title. Also if the trust is a fixed unit trust then access to the land tax free threshold could be maintained.

Thanks for the kind words..

Banks don't accept credit cards for loan repayments.

LC

You are still confusing different issues I think.

1. CGT.
A main residence can be left vacant indefinitely and be free of CGT.

2. Income Tax
A residence can be left vacant for any amount of time, but you could not claim any costs unless it is available for rent and you are actively looking for a tenant.

And you might find that a valuer may think what you paid is market value. Start collection details of comparable sales (sales not just listings)