You’ve posted twice, see my reply here:
https://www.propertyinvesting.com/forum/topic/26171.html

Terryw
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It really depends on how the trust is structured and the lenders policy. I have just written on this in my newsletter – send me an email if you want a copy.

Generally for asset protection reasons, you want to keep guarantees to a minimum. However, sometimes you may want to or need to include a partner for servicing reasons – your income alone may not be enough to get the loan through.

To give you flexibility, be careful with the wording of your trust deed. If you don’t need your wife’s income to service, it may be better not to name her at all on the trust deed at all.

Some lenders want a guarantee from all adult beneficiaries named on the deed. So I would consider having neither your wife nor your son named at all on the deed. Each will still be a beneficiary, coming under a general beneficiary category due to their relationship to the trustee. No need to name them.

Your wife still may be able to guarantee the loan if necessary, but not naming her will mean you can also leave her out, and preserve her borrowing capacity for next time.

Terryw
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You can only claim one property as your main residence. So moving into the IP will mean if will be tax free that the period you live there, but at the same time, your home may be CGT liable for the period you didn’t live in it.

Terryw
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Why not see a second broker for a different opinion

Terryw
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a business is not a separate legal entity, so they cannot own property. The only options for owning property are via a personal name or a company, or either as trustee for a trust.

A Trust is well worth looking at.

Transfering properties over to a company or trust will result in stamp duty, and possibly CGT.

Terryw
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Sometimes it can be costly to bring the standards up for strata titling. – eg meeting requirements for fire exits etc.

Terryw
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Maybe the value has increased? If so, you can probably sell before settlement, or maybe get a loan based on the value. If it has risen enough, you may not even need a deposit. I have had a few clients recently who are settling off the plan. prices in Sydney and Brisbane have increased slightly above the contract prices.

Not settling could be costly.

Terryw
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Dee dee, Its a bit hard to say when you don’t mention who the bank is. Usually offset accounts cannot be on fixed loans, but can be on IO loans.

Terryw
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I’ve bought out a partner before.

It is just like buying a new property, you will probably need a solicitor, titles have to be changed, stamp duty paid etc.

With the loan, basically a whole new applicaiton will have to be done. The lender will need to know if you can service the loan on your own, and new mortgage documents etc will have to be issued.

Terryw
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Richard is correct in that RAMS don’t lend for construction loans on a No Doc or Low Doc. There are a few lenders out there that can lend up to 75% LVR based on the end value of the project based on a No Doc with 1 day ABN. This should be enough to cover the costs of construction.

But the best way forward would probably be as Richard suggested to get a loan on the land and a LOC on the other property and use that to build.

Terryw
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