Hi there,
In a nutshell…..
Just wondering and thinking about setting up a discretionary trust or similar so that I can purchase property in the trusts name and not my own name (thus the trust/properties in trust is untouched if i was to get sued civiliy ……. with all that is going on in todays world we can be sued for almost anything)
My question is If I have assets – ie: my own home in my name, will banks accept my home as security while my brand new trust is set up in the name / company name of my choosing….. as without a loan from the bank to purchase investment properties in the trust its over before it has begun.
Hope you can help
Hi
Most lenders will not have a problem lending to a newly established trust as they will require you (and other adult beneficiaries) to guarantee/indemnify the borrowing.
With your property as collateral you should no problems.
Mike
Don't assume that the trust assets cannot be touched. It all depends on the structure, how it is set up and how things are conducted.
I agree with Mike on the bank side however – new trust won't be a problem if you can qualify for finance on your own.
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 Gav
As the boys have pointed out financing a property using a newly formed Trust will not be a problem however you will be suprised how lending terms will differ.
All things being equal there is no reason why you shouldn't get the rate / applic fees etc as you would if you were buying in your own name.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi TerryW,
Can you elaborate a bit on your points just in the process of planning a trust what should I include/avoid so assets can never be touched !?
Thanks..
Additionally, do you need a 20% deposit when purchasing through a trust or can you get away with 10%+ and LMI?
I
Gazza21 wrote:Hi TerryW,Can you elaborate a bit on your points just in the process of planning a trust what should I include/avoid so assets can never be touched !?
Thanks..
Could write a book on this topic as there are so many ways a trusts assets could be at risk.
Setting up through an accountant or your is very dangerous.
Consider the following
type of trust
terms of deed
classes of bebeneficiaries
How to contribute capital
who should be trustee
control of trustee
who is director of trust
number of shareholders of trustee
constution of trustee
specific benbeneficiaries
Who is appointor
how many appointor
death of appointorde
ath of major people behind trust
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
this foru
Hard to navigate and stupid auto correct I give up trying to post on an iPhone
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 found that when typing on my iphone, in reply to a message on this forum, you type away and then it takes about 2 secs for the characters to appear on the screen. Doesn't seem to happen with other forums. And then the curser jumps around – which could be due to my fat fingers.
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
Let me expand on my post above.
Some things to consider when setting up a trust:
Consider the following
type of trust
terms of deed
classes of beneficiaries
How to contribute capital to trust
who should be trustee
control of trustee
who should be director of trustee
number of shareholders of trustee company
who should be shareholders of trustee?
constitution of trustee
specific beneficiaries
default beneficiaries
right to retain income in the trust
Who should be appointor
how many appointor
death of appointor
should there be a guardian
death of major people behind trust
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
Gazza21 wrote:Additionally, do you need a 20% deposit when purchasing through a trust or can you get away with 10%+ and LMI?Its possible to get 90%
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
With the right lender you could actually get 95% in a newly established Trust.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
You must be logged in to reply to this topic. If you don't have an account, you can register here.
