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Hi Steve
That is not my understanding.
Even many years ago the lenders used to check all companies that appear on someone's craa. They often do, and did, craa checks on those companies to check borrowings and defaults/court judgments etc. They also used to ask for financial statements for all companies that an applicant was director of. This is not something new but standard practice.
Many banks ask on the application forms for all loans guaranteed. Even those that don't will want to know about all loans guaranteed. St George is one bank that didn't ask about guaranteed loans on the applicaiton form, so I wrote to them and asked and they confirmed that they wanted to know about all loans guaranteed and will take them into account for serviceability. With all the rental incomes wages etc if you can service then there is no problem. But setting up separate structures will not help at all – unless you can find a lender that does not take personal guarantees.
Just think for a moment, if someone has guaranteed 10 loans with 10 different structures how is this different, from a lending and guarantee poit of view, from getting 10 loans in their own name?
Would you care to name a lender that this multiple structure works with?
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
yep, a pdf version.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
It certainly helps, but it still may not be enough as banks tend to only count 70 to 80% of the rent and often assess the loans with a buffer interest rate of 2% more than current variable rates – and sometimes at PI too.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Fancy names for basic proceedures. Just go and see a good lawyer.
for the second, what you do is set up another trust and place a second mortgage over existing property. There are no stamp duty or CGT consequences as there is no transfer.
Incidently there was a Federal court case in the last few weeks favourable to hybrid trusts (forrester from memory).
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Deeds also need to be constantly updated as legislation changes too and circumstances change.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Just ask one of the banks if you need to declare personal guarantees and see what they say.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Most properties have problems, especially 50 year old ones.
I would try to withdraw your offer and then make a lower offer – work out approx how much it would cost to fix.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Don't sign anything without running it by your solicitor.
Personally I would amended it slightly by specifying a bank and the loan amount. If they don't accept it you can say you will find someone else.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
YEah, no need to cross collateralise.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Try Michael
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
I've been a broker for 10 years and don't believe it is possible to do as described. I am surprised that it is being promoted again.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
I am reluctant to say anything more as this is Steve's forum. Its a good marketing concept – unlimited finance!
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Gifting = same as selling for GCT and stamp duty
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
http://www.guardianpartners.com.au
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Transfer = sell
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
ArnieS wrote:There have been some really good comments. Asset protection is over-argued and in most cases will only apply to the very rich. Complex structures are often set up with no commerciality in mind. If you are using negative gearing as a strategy to build wealth – you will need to access the equity to continue the strategy. You don't want to trap your equity. The banks are going to get the properties via guarantees, mortgages, fixed and floating charges. Let us assume that M Y is going to build up a portfolio of investment properties. 1. Put the first few properties in their personal names. 2. Use negative gearing tax advantages. 3. Take advantage of the land tax thresholds. 4. When the properties go cash flow positive, start putting new properties into trusts etc. The old properties can stay where they are. 5. If you are worried about getting sued, buy better insurance. 6. If you are worried about getting divorced, get a pre-nup. If you are already married, the Family Court can look through all this. 7. If you are worried about your son or daughter in law getting hold of the fortune that you have built up for your children – use complex trust structures. Cheers ASome good points there, but 5, insurance won't stop you getting sued or cover you in many situations.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
s 116-30 ITAA 1997
http://www.austlii.edu.au/au/legis/cth/consol_act/itaa1997240/s116.30.htmlWill be similar for stamp duty too.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
This is a common question lately.
The answer is that this is not possible because personal guarantees will be required.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
ANZ uses a number of companies for valuations. It will vary from area
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
I would split up the assets into a number of discretionary trusts.
All trading should be done via a Pty Ltd company with shares owned by a discretionary trust.. Probably split up the trading into a few companies. These companies should not own any assets, business asset should be owned by a separate serivce trust.
I would also have another trust take out options to purchase properties owned, 2nd mortgages and long term leases to help with asset protection.
You might even want to thrown in a trust set up in a tax haven. Still can declare your control to the ATO, but it add another layer and another jurisdiction to make suing you much harder and more complex
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
