Hi,
I don’t know how to email this question to Steve but anyone that could help in regards to this – well thankyou – your help is greatly appreciated.
Steve, at the seminar, mentioned about setting up a second and third and even fourth Company Trust to buy more properties. My question is How does this work and How do you go about doing this. I know how to set up one Company Trust – but several – sounds very interesting but I’m not sure how it all works and sums up. Thanks again.
Also, if anyone knows of websites, magazines, books or CD’s that would help explain this that I could get a hold of, it would be grateful if you could send me that info. Thanks.
Kind Regards,
George.If You never never ask, you’ll never never know”
Hi again George
Some say it is advisable to not have all your eggs in the one basket. It may be better to limit your trust’s assets – just in case. So after you buy a certain number of properties, just set up a new trust.
that’s all there is to it!
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 Terry,
thanks – but its not the issue of setting up more Trusts (that’s the easy pary – only costs around $2000). Steve mentioned he sets up several Trusts to buy more properties. Here’s what I mean:
say Ive bought my 1st Investment property for $100,000. Ive paid 20% Deposit and owe the bank $80,000. I obtained this loan on the basis of my employment alone and it is in a Trust account. By setting up a new Trust account (costing approx. $2,000) how will this enable me to purchase additional properties. Does the 1st Trust become security for it? How – when my job is the only security for the loan on my 1st property?
Please help – I hope I haven’t confused you.
Kind Regards,
George.If You never never ask, you’ll never never know”
Geo,
I think what Terry was refering to was from an asset protection perspective. If there was a situation in which something when wrong with one trust, you are not exposing all your assets in that one trust.
I am not aware that it would increase your borrowing power at all, because ultimately you are as trustee (individual or corporate) guaranteeing the due performance of the loans.
Unless there is something I have missed Terry(?)
James
I think Steve has previously meantioned that it is possible to get unlimited finance by setting up a new structure when you ‘max out’ the current one.
But this is not true as you must personally guarrantee each and every loan, so setting up a new structure has no effect on your borrowing capacity. each time you give a guarrantee it would go on your CRAA. Also you would be required to list these guarrantees in your loan applications under the statement of positon section.
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 Terry and James
much appreciated info.
Kind Regards,
George.If You never never ask, you’ll never never know”
I think what Steve mentioned at the seminar was that when he hit his credit limit with one trust he would set up another company and trust. He would apply for loans through this one for his next few properties until he got knocked back again. Then do it all over again. However he did mention that it worked this way for him but it may not work for everyone. I suppose it depends on the lenders.
Delboy[cap]
I’ve been told that some lenders won’t count your ‘guarantees’ against your servicability when looking at you for more loans…..
Cheers
MelMel. They all should, but I know some loan application forms are not worded very well>
But it would appear on your CRAA anyway.
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
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