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Media beat up? There are heaps of shoky brokers out there, so maybe it is not entirely a beat up. But then again, I have never received an overseas trip! We do get pens and wine openers sometimes.
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 is just a lease with an option to purchase the property. These can be structured many ways, and it could enable you to control property for a small outlay.
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
The loan would need to be in the same names as the title. You could both be on the title and just have an agreement to borrow the money for the deposit off you friend, or you could go on the title alone and then have a side agreement with your friend. – But you would be taking all the risk.
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
There is a specific tax ruling on this topic. I can’t seem to fin the reference at the moment, but you need to prove that you were living there at some stage. eg Electoal roll, electricity statements, mail at that address, 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
It may be illegal to charge a fee for finding properties in certain states, if you are not a registered RE agent. Just ring the Dept of Fair Trading in your state to find out.
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
Another Option you may or may not want to consider is selling one or two of your investment properties, and using the money to pay off your home loan. This would kill your non deductible debt (or a lot of it), and you could then reborrow the money for more ivnestments.
BUT, you will have to pay CGT and stamp duty when you buy new property to replace the old. How much would depend on how much you purchased the properties for and your incomes at the time of sale. If you have scaled back work, you may have a low income this year.
This may be worth considering, depending on your situation.
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 Shirley
I read this too. I don’t know why he would write that-puzzling.
Having a large capital gain in a trust would be the best place to have it. You can still distribute it to yourself if need be, but circumstances change yearly, so it may be best to keep your options open.
I think some financial planners and accountants just frown on mums and dads having trusts.
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
Its about the only Australian resource available. It is very genral in nature and althou giving you lots of ideas, it doesn’t go in the figures. Its worth getting if you are consdering LOs.
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
Dave
That may be so, but the wrapee would not necessarily know until too late. If the wrapper has no other assets, then the wrappee could be in trouble financially.
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 agree that it would be a good idea to look into setting up a trust. First get a book called “Trust Magic” avialable at http://www.gatherumgoss.com and study it to get a rough idea of how trusts work, and then go and see an accountant. Trusts can be set uo for as little as $275, but an accountant will charge a lot more.
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
You could just get a couple of valuations done (and average them), and add your margin to this (20%) for the tenants purchase price.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
Thanks JMN. I have laid low for a while now – they will think I have gone away. Now might be the time to retry.
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
Lookup Lewis O’Brien.
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 really only need one, but when it runs out you would need to increase it again (assuming growth), or start a new LOC on another property.
You don’t have to refinance to increase the LOC.
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
Banks generally want to see 5% genuine savings for your first property. genuine savings means money buliding up in a bank acocunt for about 6 months.
Buying a cheaper investment property is probably the best way to get a foot in the door. If you keep saving for a Sydney property deposit, it could grow faster than you could save.
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
If the wrappee’s loan ever gets less than the wrapper’s loan, then the wrappee may be in trouble. I think the wrappe should monitor the wrappers loan levels (eg reeceive copies of statements) to make sure this doesn’t happen. If the bank were to foreclose, the wrappe could end up with nothing.
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
This is a difficult one. The B&B thing would be a commercial loan. You wouldn’t get 80%, probably 70% or less. There may be other difficulties due to location. You would probably have to show you can service the loan on existing income.
If you want to buy land and construct, it is also difficult. Some banks will lend you money based on the end value. If there is enough meat in it, you could defer repayments and capitalise the interest.
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
Banks do allow your to borrow the deposit in some circumstances. But you will need a good income as you would have to show you can service the repayments on both loans, and personal loans are at high rates over short periods, so the repayments can be very high.
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 is not compulsory, but a good idea. If things go bad, the wrappee may end up saying they didn’t know what they were getting into, having legal advice means they can’t.
I think what you described happens a lot. Most solicitors don’t even know what a wrap is. To overcome this, you could send your clients to a solicitor that knows what they are doing. There is a list on the VFA of soliicitors for this purpose.
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 agree with James. Deposit bond applications are just as difficult as loan applicaitons. So if you can only afford one, then probably you wouldn’t qualify anyway.
And beware of the so called ‘discounts’. Usually it is all crap.
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
