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The ATO does not like people renting from their own unit trust, see:
TR 2002-18 – “Income tax: home loan unit trust arrangement”
Available from:
http://law.ato.gov.au/pdf/tr02-018.pdfTerryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Beware of fixing. This can make changing banks or even selling your property costly if rates move.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
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BTW the interest in the above scenario should be deductible as you have borrowed money to purchase a income producing property. Please confirm this with your accountant.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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IP valued at $500,000, loan $100,000.
Husband buys the wife’s share for $250,000 and borrows the lot. $200,000 would need to be borrowed with this money given to the wife who then uses it to pay into the home loan/offset.
Watch out for CGT – may be low if wife is not working, and stamp duty. Stamp duty may be avoided in some states on transfers between spouses.
Selling to a trust may be a better solution.
Terryw
Discover Home Loans
North Sydney
[email protected]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 probably oculd be deductible, but you may lose your CGT exemption if you claim it. Better talk to your accountant to make sure.
Terryw
Discover Home Loans
North Sydney
[email protected]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 think it can work well if done correctly, but be careful. Not having a job may hurt your chances of obtaining (good) finance.
Terryw
Discover Home Loans
North Sydney
[email protected]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
FWIW, I agree with Celivia, If I was selling, I would only accept a reasonable deposit -about 10%. This is to make sure they are serious and to allow me easy access to the deposit if they do not settle. You could legally chase them for the rest, but that would be a hassle. Much easier if it was just given to you from the trust account.
When buying, I am not too concerned about how much I put down, as the full amount will be payable anyway within a few weeks.
And, Moony, I think there would still be a valid contract without a deposit. ‘Consideration’ is the promise to pay, not the deposit.
Terryw
Discover Home Loans
North Sydney
[email protected]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 may be better to just rent out the whole thing, and let the tenants do any subleaseing of the granny flat. You renting out hte flat when it is not approved may result in you not being covered by your various insurances, and this could cause problems.
Terryw
Discover Home Loans
North Sydney
[email protected]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
You just have to approach the owner and put you offer to them. If they accept it, talk to your solicitor about getting a option contract drawn up.
Terryw
Discover Home Loans
North Sydney
[email protected]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
Steven, that is a good rate. Would this product be available for owner occupiers only? I did one a while back for someone with a small blemish and the rate ended up over 10%.
Terryw
Discover Home Loans
North Sydney
[email protected]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
Also, If there is a loan on the property, this will also have to be renegoitated. There may be fees and another application with proof of income etc would probably be required.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Originally posted by stran:Hi,
I’d like some recommendation on good books to read to get an understanding of the different trusts, how they can be applied to investments especially in Australia.
Tanks
Tanks
Try http://www.gatherumgoss.com and look for the book, Trust magic, costs about $99. but is worth it.
Terryw
Discover Home Loans
North Sydney
[email protected]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 have used Mcdonalds and Associates. Don’t have the details handy, but they are right in the city and are very profsssional.
Terryw
Discover Home Loans
North Sydney
[email protected]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
Oops. Sorry Steven and Simon.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi Devil
It is possible to get loans for some of the big franchises. Maybe around 60% is possible for some like seven eleven, gloria jeans etc.
Terryw
Discover Home Loans
North Sydney
[email protected]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 have been looking at Condo units, starting prices seem to be from about 600,000B (A$20,000) up. They are not too bad, I have rented one, and it would go for about 900,000B (A$30K). I would be content to live in this one for a long time.
Rental yields are not all high, they would be around 8% or so. Interest rates are around 6-7%, but I have haivng trouble finding someone to borrow from as I am not working here, nor a resident.
I have also checked out building in the countryside. Constuction of a nice and large home would be around A$20,000 with a nice large price of land at around $10,000 +. There are much higher rental yields in the country, but the capital growth is smaller.
One problem is the ‘system’ here. The legal process is not like Australia, and if things goes wrong, the law doesn’t always help. eg. you can register caveats on land, but these are generally ignored.
It is fun looking anyway.
Terryw
Discover Home Loans
North Sydney
[email protected]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
Hi Everyone
Thanks for the replies, I am still in Bangkok and have been looking around, and talking to people. I have heard a few bad stories such as this one:
Western man meets Thai girl, he decides to retire and buys a house for 23,000,000B (nearly $700,000) and a mercedes benz. Since he is not a resident, he buys it is his girlfriend’s name. He then goes back to his country to get his superannuation money. He is away a month. When he comes back, the car is not in the driveway, but the lights are on. He tries to open the door, but the keys won’t fit. Then a strange man opens the door, and they ask each other, “who the hell are you?” The guy in the house tell him that he just purchased the house from a thai lady. It seems the woman sold the house, the car, and just took off.
There are supposedly many stories like that floating around.
Terryw
Discover Home Loans
North Sydney
[email protected]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
Good news Simon.
Terryw
Discover Home Loans
North Sydney
[email protected]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
Take any longer than a normal purchase. Banks will want to see the trust deed and have their legal people ‘review’ it, so maybe an extra day there.
Terryw
Discover Home Loans
North Sydney
[email protected]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
YOu may be able to get the vendor to rescind the contract and you sign a new one with the new names.
Terryw
Discover Home Loans
North Sydney
[email protected]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
