Hi Folks
I earn a low income as a part time party plan consultant (under 10k after expenses), and my husband and I were talking over the weekend (funny that, married and still talking [
]) and we were wondering how we go about getting finance for a + IP that would obviously be best off in my name.We are also concidering a more secure structure such as a family trust, but at this stage let say they isn’t on the cards.
Hubby has a very good income, but how should we approach the lenders.
Cheers
Leigh K[]It would seem that you could get the loan but Hubby could go guarantee for it. His income could support the loan. Check out Steve’s Wealth Guardian when it hits the pavement. Supposed to be very good.
Always worth talking to your accountant as well.
Enjoy
AD [:0)]
(Andrew)“”Imagination is more important than knowledge. Knowledge is limited. Imagination encircles the world.”
Albert EinsteinAs AD mentioned, if you wanted to buy the property in your name only, you should get hubby to go guarantor for you.
However there’s nothing wrong with both of you going on the loan application, but the property being in your name only.I’d highly recommend a trust structure to purchase your IP in as it will give you greater flexibility with income distribution as well as providing tax bonuses. In this situation, you buy the IP through a family (discretionary) trust and the trustee will distribute income to the lowest income earner – which would be you in this case. But if you’ve got kids, you could also distribute some of the income to them as well resulting in less tax to be paid.
Good question, but are you sure it would be better in your name? Obviously I don’t know the enire situation but usually its best to put it in the highest income earners name as a positively geared property often still looks negative to the taxman.
But yes you can buy a property in your name if your credit check is clean. You would need to get a low document loan as if the lender sees your tax returns they will decide that you cannot support the debt (they will not take your husband into account). Often it is better to refinance a house already owned to get some of the money and to then get the rest by borrowing against the IP you are buying.To approach a lender about your situation just tell them your situation and make an appointment and they can work out both a structure and a loan type to suit you. It seems like the family trust idea is a good one, however most lenders wont know much about it, talk to an accountant.
From personal exp most lenders would rather not deal with family trusts! Recently I helped someone with a loan and the paperwork blew out to 129 pages!!! Boy did I clog some fax machines! Several forests died in tha making of that loan.
Otto Dargan
Home Loan Manager
Mortgage House Five Dock
0297128988[
Depends if the property is +vely geared or -vely geared. Suggest it be in your name if it is +vely geared. If it is the latter, then preferably that it be in hubby’s name or even jt names.Thanks for your input folks,
It has confirmed out expected line of attack. Just as an outline we do already have a -geared IP in hubbies name and will be putting +IP’s in my name, however after reading the Wealth Guardian that Steve sent us, we are doing more research with an accountant, into family trusts.
Thanks again!
Cheers
Leigh K[]
]) and we were wondering how we go about getting finance for a + IP that would obviously be best off in my name.
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