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I use a trust. It is, in my opinion, without a doubt the best way to go!
Terryw
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Vul
I had the same problem with an overpriced course I did in SYdney a few years ago. I ended up reporting the company to the Dept of Fair Trading and then they quickly gave me the refund.
Terryw
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Do they still offer a full refund if you withdraw on the 3rd day?
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Borrowings for a trust or company has the same effect as borrowing as an individual. This is because the bank will require the Trustee to guarrantee the loan. If teh Trustee is a company, then all directors must guarrantee the loan. It appears on your CRAA.
Terryw
Discover Home Loans
North Sydney
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Try
http://www.stockcentral.com.au/forum/This is a realllly good forum.
Terryw
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Fullout
Don’t do it. It is not worth the very high risk of losing all you money for a mere 25%.
A lot of HK disciples recently lost all their money when the developer went bust-some fraud involved as well. Some lost $300,000!
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
“be careful if you are talking to bank staff about finance structures. They know about their own products”
Sometimes they don’t even know about their own products!
Terryw
[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
try
http://www.chrisbatten.com.au
http://www.taxlegal.com.auTerryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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For what its worth, I completely agree with Stu.
Terryw
(Mortgage Broker)Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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There was a whole development that went bust recently. Many people have lost $100,000 and more in this mezzanine finance investment. And the company involved was allegedly intorduced to investors through a ‘investment’ company famous for Mezz finance.
Terryw
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I am in Sydney but honestly could not recommend any accountant up here that I know of. I would rather recomend Dale Gathenum Goss in Melbourne. He understands wraps, property and trusts fully.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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I also rent while at the same time owing many investment properties.
One good idea is to live in one of your rental properties as your PPOR for a short time. It is then CGT free if you sell (within 6 years)-even if you rent it out. At the same time run some sort of business from home so that you can claim part of the rent as a tax deduction. And you will be able to rent for a fraction of what it would cost you to own the same property.
Terryw
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007
It is probably a good idea to check out big places like Masterton initially and then to get some quotes from local builders. Which area are you lokking at?
Terryw
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hwd007
You can make some good money doing this. One of my clients is doing it now and I managed to get him 100% finance for the whole thing. He has purchased some blocks of land off the plan (ie before subdivision) and is going to build duplexes on the blocks. We could get him finance based on the end value of the townhouses and there was enough profit in it for him to capitalise the interest until completion.
What you need to do is get the DA application in as soon as possible as this is what slows you down (maybe before settlement?). It could take a month to get through and cost up to $10,000. You will also need a fixed price contract for construction so the price doesn’t blow out, and arrange finance. You could even sell off the plan to minimise your risk, or go for it. if their is enough profit in it, you could keep the lot as the LVR at the end should be around 70% or less (otherwise there is no enough profit in it!).
Terryw
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This is interesting. I once seen accountant Dale GG answer a question about doing this, and he said he new of no way to avoid stamp duty. Maybe this is a way of minimising it. But is there stamp duty on shares now? I thought it was abolished. to buy the company would mean just transfering the shares, so maybe there would be no stamp duty involved?
Terryw
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hwd007
Good try again. You can sell it for $1 if you wish, but you must pay tax and stamp duty at the market value.
Terryw
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Hi
I am a mortgage broker and think JohnD makes a good point.
If you get a $200,000 loan with your spouse (or anyone) and then go for another loan on your own, when the bank looks at your serviceability, it will generally consider you liable for the whole $200,000 (But will only take into account half of the rent you receive for that property).
This is a common problem I see daily. When things are borderline we can argue that they are only responsible for half the debt, and it will probably get thru, but when things are tight it is harder.
So I think from a long term point of view (if you plan to buy many properties), it may be worth considering putting one person on title. Banks and Mortgage Insurers also often have maximum exposure limits (ie Max total lends) so keeping things separate will help.
Terryw
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Red
I think with a Hybrid trust, the unit holder can borrow to buy the units, and the interest on this is able to be offset against the unit holders other income. check out http://www.chrisbatten.com.au
Terryw
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Ishita
Thanks again.
I think I can answer that question. Discretionary Trusts cannot distribute losses. Losses must be quarrantined in the trust until the Trust makes a profit. I am not sure about unit trusts?
A hybrid Trust can partially get around this as the unit holder borrows money to buy the units, and so is able to claim the interest on this loan against of non trust income. (I think).
Terryw
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There are a lot of Mortgage Brokers out there that don’t know what they are doing. There are many lenders that offer 90% loans without genuine savings. And I know of one with 95% LVR with no genuine savings.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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