In that case, maybe a company trustee is a good idea. Each partner will still be liable for the whole loan though. However if one wants to get out of the deal, it may be easier to let then leave without changing title deeds etc.

It depends if you were restricted due to lack of deposit or income?

If income, then  you will need to have had a large pay rise, probably. Things have tightened up since then so it will be harder to qualify – in fact you should check up that you can still qualify for the one you have applied for.

If your income is ok, then you may be able to utilise the equity, but you will probably find the lender will only lend you x% (maybe 80%) based on the value as long as it does not exceed purchase price. This may free up the money you were going to use as deposit so you can use that on the second one.

Otherwise you will need to settle on the unit and apply for a quick increase – whether this will be granted so soon after settlement is up to the lender, but pobably will not be approved if LMI is involved.

If you transfer it to a trust now you will incur stamp duty and lose the tax exempt status of the place. The trust will also probably run at a loss which you can only offset against other income of the trust, not your own.

Can't see how transferring it to a trust can save you any money.

If you transfer it into a trust you can just hand over control of the trust to your dad later on, without transferring the property and without CGT and stamp duty. This may not suit your dad's situation though.

Thats a good point Richard. Just out of curiosity do you know the level of commissions in the USA or UK?

Hi Mat

You could do that, but you can only claim one house (except for 6 months cross over) as your main residence at any one time.
So if you are living in your new house and claim the old house as the main residence for 6 years, then you will be liable for CGT on the new house for this time. So what you would do is to wait and see which one has the least capital gain – maybe, or you could just delay CGT by claiming exemption on the one you are selling regardless of which one has gone up more, depending on your situation.

I would say you can as long as you intend it to be an investment property. Confirm with your account.

It could be done, but you would have to pay stamp duty on the transfer, get a new loan, new loan fees, legal fees etc. Companies will also pay more CGT than an individual when you sell and negative gearing losses cannot be offset against your personal income.

usually all siblings will be beneficiaries automatically without being named – actually every relative, alive or yet to be born, will be included. But there will be tax consequences if you distribute to a non-resident (for tax purposes). They may have to pay more tax. But once they move over here they could start to receive distributions then as per normal.

Read a few documents on trusts here

http://www.moorestraining.com.au/

and

http://www.lawcentral.com.au

You should never (or rarely) pay down a loan, especially a investment loan. Maybe you could change the portfolio to a standard IO loan and set up an offset account against that.

Dexter

I had some discussions on this with an exATO guy and he suggested something similar. You would be borrowing to pay investment expenses which is acceptable business practice, but there is still a risk the ATO will deem it a scheme to reduce tax. It may also help to have the LOC and the home loan at a different bank – to make it look less like that capitalising interest product from the Hart's case. Not paying down the PPOR loan, but having an offset would also look better than paying the loan down.