Forum Replies Created
O’h no – I ment queries to any Q’s you have of a Legal or Accounting way after you have seen your accountant. [
]Rgds.
Lucifer_auYou should be looking to retire around 26-27. That means 4 years for learning, 7 years to become retired, which seems about right… So I suggest you buy alot of books, and go to a few inexpensive seminars (the $69- ones!). Books I would suggest you get are: John Burley, Money Secrets of the Rich; Robert Kiyosaki, Cashflow Quadrant/ Rich Dad’s Guide to Investing/ Prophecy/ If you want to be Rich & Happy don’t go to school (all of these are by Robert Kiyosaki).
Tht should be all you need for yr1. It might seem like alot of work, but would you like to be retired at 26/27 or earlier, rather than having to be a slave and go to a job until you are 65 (you might want to be 55 when you retire, but the gov. needs you to work untill 65, as the equals another 10yrs of tax revenue (with them taking over 50% of your income)).
Also you will have alot of fun with investing, and the more you do of it the more money you make, so thats why you want to be retired so you can do more investing, make more money and have more fun.
PM me if you want.
Rgds.
Lucifer_auI guess so (as you are living in it), check with the OSR (just be a bit cautious… Gov Departments tend to get the wrong idea – “what, your trying to make a profit? Well then No!”).
Rgds.
Lucifer_auPerhaps your partner/family could get the personal loan and you borrow the money. Of course you pay them back.
Rgds.
Lucifer_auYou might have to get permission from a foreign review board or equivilant.
A way round it, is to use a coporate strucutre (so you don’t need citizenship).
Rgds.
Lucifer_auInterest only loans could bump up the cashflow from the property (should get an extrea $20-$40). Make sure you check out what going to happen with future employment.
Lastly the RE agent might be a bit generous with what s/he thinks the prop. will rent for – I suggest some more due diligance.
I get round $360K gross borrowings (from a bank to a wraper) as well. If you paid off your credit cards you could borrow another $40K, so I would highly suggest you pay them off ASAP (or even take out a personal loan, and using the saved interest that you paid on your credit and apply to your loan (that part is the most important part!). Also cut up your CC (until youi can control your debt levels better)..
Perhaps move into a cheaper place to save money to afford a deposit, for your next ptoperty (as well as to pay of those credit cards!).
You also said that you have found a property, give us the details of the prop. so we can see if one of us can help[ you (price, location, rates if known, etc).
Heres my previous reply to a a differing thread by you, don’t know if you saw it or not…
“
You can go guarantor on the loan, but simply going guarantor doesn’t mean much to the banks anymore (they dislike repo’ing guarantors property, esp. the family home), so they still will assess her on the main loan criteria and if she doesn’t qualify then they will simply deny the loan.There is also problem if you try to get the loan, but she ‘buys’ the property (i.e. title goes in her name). The banks would call the loan back (as you have breached one of it’s conditions) and you would have to pay back the loan immediately.
So there are 3 options, first you gift her 20% deposit (she can get a no/low docs home loan, but still must meet bank criteria), or you could on sell with a wrap (so she can still qualify for FHOG). For more info on wrapping go here:
http://propertyinvesting.com/forum/forum.asp?FORUM_ID=13
If it was me, I would wait until she got a job (how will she pay the mortgage if she doesn’t have a job???). So she might have to get short-term rental, or move in with you, but if she can’t see the opportunity you are giving her (for a bit of short term inconvenience) then she obviously can’t handle the responsibility of a mortgage (this point is extremely important).The third is you buy a place together and live in it (together), but put title in her name, but that means you are both repsonsible for the loan and she could kick you out at any stage and you would have to go through a court battle to get recognition that you own a part of the property. If you went down this path you I would suggest you go and see a lawyer (one that knows about cavets, etc). The banks would find it hard to call in the loan, and probably wouldn’t bother (or a mortgage broker would prob. disclose it to the bank, and then there is nothing to worry about).
“Rgds.
Lucifer_auGo here:
http://www.firb.gov.au/content/real_estate.aspRgds.
Lucifer_auI asked up front how much this was going to cost (I haven’t paid this much for a specialist surgeon!) and so would like to get value for money from this first visit.
>They can be quite expensive!
1. What should I take to the appointment in the way of paperwork/figures?
>The first thing you’ve got to consider is time constraints, theres no point in taking reems of paper if you are going to see him for 30mins. Try to get a feeling in wether s/he will support you, rather than going there just for info
2. What questions did you think of asking down the track that you wished you should have asked at the beginning?
>First of ask about costs of running a company or trust, as well as basic book keeping fees and how much to start one up (round $1,200 per company/trust, nothing more).
Also you want a accountant who will basically answer short email queries for free.3. What else should I know.
>If they advise you to do something, ask why. Without the ‘why’ you cannot see wether they are good for you or not.
>Also ask what type of structure they will suggest. You should be aiming for something like a trust with a company acting as trustee, or a trust or a company. It’s okay if they suggest for the first 2or 3 IPs to place them in your name (as long as they as relativly inexpensive) after 2/3 IPs you want a structure.
>Lastly we don’t have Legal & Accounting forum for nothing…
->https://www.propertyinvesting.com/forum/forum.asp?FORUM_ID=23Rgds.
Lucifer_auGet a corporate trustee, as this places the lawsuits further away from your assets.
It might be a bit expensive, but considering you pay little to no tax and you are safe from lawsuits, it is worth it.
Rgds.
Lucifer_auYou can go guarantor on the loan, but simply going guarantor doesn’t mean much to the banks anymore (they dislike repo’ing guarantors property, esp. the family home), so they still will assess her on the main loan criteria and if she doesn’t qualify then they will simply deny the loan.
There is also problem if you try to get the loan, but she ‘buys’ the property (i.e. title goes in her name). The banks would call the loan back (as you have breached one of it’s conditions) and you would have to pay back the loan immediately.
So there are 3 options, first you gift her 20% deposit (she can get a no/low docs home loan, but still must meet bank criteria), or you could on sell with a wrap (so she can still qualify for FHOG). For more info on wrapping go here:
http://propertyinvesting.com/forum/forum.asp?FORUM_ID=13If it was me, I would wait until she got a job (how will she pay the mortgage if she doesn’t have a job???). So she might have to get short-term rental, or move in with you, but if she can’t see the opportunity you are giving her (for a bit of short term inconvenience) then she obviously can’t handle the responsibility of a mortgage (this point is extremely important).
The third is you buy a place together, but put title in her name, but that means you are both repsonsible for the loan and she could kick you out at any stage and you would have to go through a court battle to get recognition that you on a part of the property. If you went down this path you I would suggest you go and see a lawyer (one that knows about cavets, etc).
Rgds.
Lucifer_auI do not know wether it is illegal, but I would suggest big time that you change your IO to P&I, esp. if you are doing 30yr wrap (the buyer could be one of those people who just refuse to re-finance with the bank, this is an important point to consider).
Although it would be good to have IO and then when you find the new buyer to move to P&I, keeps holding costs down… But you again want to put your loan to P&I.
Also I work out 8.99% on $257,000 @ 30 yrs. to equal $516.22 in repayments….
Rgds.
Lucifer_auOnly wraps get CGT exemption (mainly because you are vendor financing a product, just a large product).
I’m a bit surprised you wouldn’t use trusts at all though, as you can quite effectivly shelter income.
Also offers more security aginst lawsuits (company directors can still be personally liable for certain things).
Rgds.
Lucifer_auYou could pay the ATo over 6 months and the banks would see this as the ability to pay off a mortgage (i.e. the see this a bit like savings), though make sure you go through a mortgage broker.
I would also get the book “Money Secrets Of The Rich” by John Burley, I could give you more advice but it is totally irrelevant if you don’t control your spending and buy the book. After the book then we can help you further.
Rgds.
Lucifer_au1. After you have settled the property, so pretty much immeaditly after you have bought the property. You can get a database of new buyers before hand though (just make sure you know the area you will be targeting).
2. The ATO takes a view that the houses are stock, so no CGT to pay, more info:
http://propertyinvesting.com/forum/topic.asp?TOPIC_ID=8698&sortfield=&sortorder=&whichpage=23. I would highly suggest you find a solicitor in your own state – the laws can vary and you don’t want to skimp on your own legal protection (thi is a very important point). Post in the Vendor Finance Section or join the VFA (http://www.financewraps.asn.au/).
Rgds.
Lucifer_auI understand wy the NSW gov. decided not to tax farmers. Can you imagine the land tax the would pay??? Yes so you have XXXX miles so weve decided to tax you 3.2 million. Thanks.
Considring how large farms have to be to be profitable and how it basically puts otherwise vacant land to use (in alot of cases), and how it reduces our balance of payments (imports Vrs. exports) I don’t mind tbat it dosen’t affect farmers at all. And even if they did try to tax the farmers I can see the Fed Gov. comming down real hard.
The more exemptions there are, the more loop holes we can find. We want porus legislation!!!
Rgds.
Lucifer_auHe might think you are fishing and while obligated he might think it’s way to low and too close to the last offer that was rejected.
If you go to through to the owner directly, you might be getting up this agents ‘goat’ (as Kath & Kim so elegantly put it), and he might say that your fishing and you don’t have any real intention to buy the property (and probably place a curse on you and your children – okay j/k, but you get the point). You only want to do this as a last option.
Perhaps to show how serious you are, staple the deposit to a written offer. It will be tough for a Vendor to say no when he can see the money in front of him. Require it to be a cosign cheque and only get one party to sign, tell the agent ythe other party will be avalible to sign immeaditly if the Vendor accepts it.
There are plenty of good deals out there so don’t get to hung up on this deal (this is an important point).
Rgds.
Lucifer_auNo it only appies to WA.
Rgds.
Lucifer_auFrom what I know about LO is that you cannot claim FHOG, because if you try to claim FHOG you are selling the property, and because you are selling your client cannot get Rent Assistance, while with LO’s you are not selling, rather leasing so you can claim Rent Assis. but not FHOG.
Rgds.
Lucifer_auIt shouldn’t be a nightmare, as there are a number of options. First you could put the propertis in a legal entity (trusts for example), where you can distribute money how you want (so you would give cash/rental income to the person on the lowest tax bracket).
Or you could buy the properties in your name, and only you would get taxed on rental income.
Or make a joint venture document where you decide how muh of a return each person gets (though it can be very hard to change).
So there are a few options. You should also have a good accountant as part of your investing team. So they should be able to help you further – If you don’t have one, nows the time to start looking.
Rgds.
Lucifer_au
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