KP

I pay 7% to my PM in Vic, he also charges a statement fee of $2.5 per month plus there is also GST on these. It is a bit annoying to be charged a separate fee for the statement, but I have never challenged it as he is the best property manager I have ever had. (Located in Ballarat). I don’t pay any other fees. Once he even took a tenant to the tribunal and all I was charged was a lodgement fee of about $40.

For selling I have paid generally 2%-2.5% plus GST in Vic (and NSW).

Terryw
Discover Home Loans
North Sydney
[email protected]

Pursefattener

Yes you can creat a pty ltd company at http://www.cleardocs.com/ for about $937.

And you would be surprised that many accountants do not understand trusts.

Terryw
Discover Home Loans
North Sydney
[email protected]

You can negatively gear using a trust (eg Hybrid Discretionary Trust) and this will also help you reduce CGT when you sell as well.

Trusts do not pay tax, but merely distribute all income and CG to the beneficiaries. If you have many beneificaries (or even some) on low incomes, these taxes can be reduced dramitically!!!!

Terryw
Discover Home Loans
North Sydney
[email protected]

I have set up a few trusts online at
http://www.lawcentral.com.au
the cost for a discretionary trust deed is about $275.

A friend of mine has recently setup one using the deed from:
http://www.cleardocs.com.au
and this only cost $135 approx.

There are not much to trusts, you may need a bit of advice, but then could probably just set up one by yourself to save some money.

You can use an existing company as trustee, but generally you should not use a trading company as if this is sued for a business related matter, the trust assets may be at risk.

Terryw
Discover Home Loans
North Sydney
[email protected]

X

It is up to the wrapper. It is better to get them to pay for it themselves I think. either way, I guess it means less deposit to the wrapper.

Terryw
Discover Home Loans
North Sydney
[email protected]

these sorts of places are very hard to get finance too and this will hinder resales and effect values. I would not consider one of these deals myself.

Terryw
Discover Home Loans
North Sydney
[email protected]

House values can very quiet a bit, so who are they to say how much it is worth. Why don’t you consider getting two valuations done. Tell the valuers the purpsoe of the valuation and ask them to make it as low as possible, and then use this to justify the sale price.

5% is still a good yield, there may be good capital growth in years to come, so it may not be a bad deal at all.

Terryw
Discover Home Loans
North Sydney
[email protected]

Sounds like you might be with GE on their 90% low doc. Since you have only recently settled, there may not have been much growth, so it may be difficult to refinance on a low doc basis as you will only get 80% of value.

But being such a high rate, it could work out cheaper if you withdrew some money from a few credit cards and use these funds to reduce your loan and then get an 80% lvr low doc loan around 7%.

To help with the refinance, make sure all your repayments are on time. There will also probably be high exit fees for your existing loan, so factor these into your calculations.

Terryw
Discover Home Loans
North Sydney
[email protected]

Kay

Thank you for those links. I actually did this course about 3 years ago and paid about $5000. Luckily I obtained a refund – only after many letters and complaints.

Terryw
Discover Home Loans
North Sydney
[email protected]

There are a few people around that promote a similar strategy. it will work as long as you are not borrowing more than your portfolio is growing each year-say no more than 80% of growth. It is not a bad strategy, but very risky.

There are also lenders out there that will lend to you based soley on the security value. So as long as you have equity, you can continue to get finance.

Terryw
Discover Home Loans
North Sydney
[email protected]