The trustee’s name goes on title. In this case it would be the company.

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I think these sorts of deals can be great for investors. Very little deposit and nothing on your CRAA. Just buy an option and sub-lease out. If you have maxed out on your borrowing capacity, this could be a way to keep on moving forward.

Kiwi, would you allow an investor to take up the lease option

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undischarged bankrupts can borrow money – if someone is willing to lend them money.

quote:
It is an offence under the Bankruptcy Act for a bankrupt to borrow money or purchase goods on credit in excess of $4,267.00* (indexed) without informing the person with whom they are dealing that they are an undischarged bankrupt.
unquote
From ITSA
http://www.itsa.gov.au/dir228/itsaweb.nsf/docindex/bankruptcy-%3Ebankruptcy+-+long+version?opendocument#Offences

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No, I wouldn’t take advice from a real estate agent. I ahve done a few lease options, the leases are standard but the option agreements runing about 10 pages or so.

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You still must pay all the usual expenses. No different to renting a property out normally. In some states you may be able to on charge the rates and insurances. Can’t be done in NSW without problems aparently.

You will need to see a solicitor to draw up the legal documents.

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Steve

This situation was extremely messed up. I feel sorry for this family. Their accountant died a few years ago leaving them in a real mess too with rates and land tax notices piling up, unbeknown to them they also received a bad credit rating.

There were 4 brothers involved and they purchased their family home to live in with their parents. Since it was their PPOR they should have purchased in their own names. This would give them no CGT and no land tax problems. But having 4 people on title is a bit of a waste of the Main residence CGT exemption. So it would have been preferable to have just one on title.

The strange thing is, one of the brothers owns 4 townhouses in his own name too! This should have been done in a trust structure, or maybe in one each of the other brother’s names.

They could have had the whole thing tax free if planned properly.

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Lenders won’t give out this sort of information. It is on the broker web sites, or on the aggregation for broker members.

as a guide the average bank pays 0.70% of the loan amount as an upfront commission. But some of the small ones pay up to 2%!

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Each bank has different requirements and different methods of calculating serviceability. So it is possible and sometimes a good move to go to several banks.

If you have everyone with one bank and they say ‘no more’ then you are stuck – especially if cross collateralised. It may be costly and difficult to resolve this.

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I used to live in a 6 bedroom house during 1st year at uni. The owner rented each room individually, and didn’t live there himself.

Depending on the size of the place, you may need at least 2 refridgerators, and 2 washing machines.

Watch out for phones. probably don’t need one these days, but if you had a land line who would be responsible for the calls? You!

Electricity, you may be better off paying this yourself, and factoring it into the rent.

Cleaning. Some residents will be cleaner than others, and may resent cleaning up common areas under a shared arrangement etc

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If you have personal debt, it would be best to make your investment loan IO and to pay any extra funds into the persona loan (the LOC).

Your friend’s suggestion does not make sense. You would be borrowing to pay back a loan. The net result would be the same amount of debt wouldn’t it. It may also confuse things taxwise.

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