There are several reasons to buy in a personal name:
1. Access to the CGT exemption for main residences
2. Access to CGT exemption for an absence from your main residence
3. Land tax threshold
4. legal simplicity
5. tax simplicity
6. Your houses will form part of your will.

It may not be as bad as I first thought if you are never taking any money out for private use. But it can still disadvantage you. I can think of 2 ways:

1. eg.

Your LOC loan is $300,000 and you are putting in excess cash each week from rents, say $5,000 and your interest is $4,000.

Each week your balance is dropping by $1,000.
After 1 year your LOC balance would be down to $248,000. This is good because you are paying off debt.

But if you had used a offset account you could be better off. First, you may receive a 0.1% cheaper rate than a LOC. And secondly your loan balance would still be $300,000 and the offset $52,000. This would result in the same interest (or less considering the cheaper rate), but you would have $50,000 cash available.

If you wanted to buy that ivory back scratcher you always wanted you could take the $50,000 from the offset and in effect claim the interest on it, even though it is a private expense. With a LOC you couldn't.

2. Imagine you have 5 IPs and a mixed LOC – mixed because you used to put rents in and expenses out etc. very hard to track.
You then sell one IP – how much of the surplus money do you need to pay the LOC down by? You cannot continue to keep claiming interest associated with loan to purchase a IP after that IP is sold (usually).
–

If you are using a LOC just for deposits then it should be easy to work out the interest for each property – you would need to attribute interest for each property in proportion to the borrowings. Overall it won't make any difference to your overall tax if you get it wrong – but it will when you sell.

But if you are just boworring $39,000 in Jan, and then $61,000 in Feb etc, then in Jan 100% of the interest will be for property A and in Feb 39% for property A and 61% for property B. (roughly – will be different because you need to calculate number of days in month etc).

That is why I think it best to unravel now before it gets messier.

I agree with Richard.

Don't use your offset account money as this is personal funds and will be needed for your future PPOR. You have plenty of equity so use this to borrow 105% of the new property (without crossing loans).

Most of the brokers here understand loans for trusts.

hi Ptn

Sounds like you don't understand trusts – no offence meant, but keep on learning.

The $50k cash equity, is this cash or equity? If it is cash can't you just borrow it off the trustee?

Who is the trustee now?

The company can pay you a fee – but why would you want to do that?

The trustee is the legal owner of the assets of the 'trust' so all assets should be in the name of the trustee.

Maybe you are trying to increase your borrowing capacity by having the trust pay you a fee? This won't really work as the banks will want to see the tax returns of hte companies and trusts which you are associated with. The fee will also be taxable income to you.

Now work out on a yield of X% what level of property you need to hold.

eg. at 10%  pa yield  you would need $200,000/0.1 = $2,000,000 in unencumbered property.

At $500,000 per property you would need 4 properties.

Thats the easy bit, now you have to work out how to acheive it. It might mean buying 8 properties now and then selling 4 in 10 years when the have doubled and using the proceeds to pay off the loans.

You will need to read your contract to see what you agreed to do. Its generally too late to change things now, but you could have negotiated around this by requesting a longer settlement period once the plan was registered. Wet carpets is likely to be a minor defect and probably wouldn't delay settlement.

 What does your lawyer say?

http://www.lawyersrealestate.com.au/

Not sure if they do other than conveyancing though.

Thanks. Sounds very promising then. I have a good friend in Regensberg.

What is the capital gains over there like in general?

WOuld it be possible for the non German background foreigner to own land in their own name and to get finance there?