Forum Replies Created
Hi Brad
No unfortunately all of the wraps we have ever done have all been in Qld.
Richard Taylor | Australia's leading private lender
Hi Mike
Couple of options but being this time of night I will be fairly swift:
1) Yes you can claim the FHOG (assuming it still exists in is current form) if all other quailifying criteria have been met. Purchasing an IP first even in your own name does not disqualify you. The Stamp Duty concession is a different matter and will vary from State to State. Check with the OSR in your State on this.
2) No the Trust cant give the guarantee but you as the Trustee / Shareholder can and this is what they will require.
3) In most cases i would advise any client to buy their first place in their own name, structure it correctly, claim the FHOG and SD concessions and then once they have met the qualifying conditions by all means rent the property out and if renting elsewhere maintain this as your PPOR. Future properties can certainly be purchased in an alternative entity.
Richard Taylor | Australia's leading private lender
Hi Raewyn
What sort of additional research are you looking at ?
Property, finance, legal ?
Richard Taylor | Australia's leading private lender
Hi Jeff
The wrap kit never gave you a compliant Contract for you particular State.
If you email me and tell you what you are after I maybe able to assist.
We still sell our fully compliant Wrap Contract for Qld in PDF format.
Richard Taylor | Australia's leading private lender
In Qld if you sell direct more than 6 properties a year you are required to hold a Developers License under the Property and Motor Dealers Act.
Richard Taylor | Australia's leading private lender
You would still get 90-95% but not all lenders will offer you the interest rate discounts you would get if buying in your own name or have a personal Trustee.
Richard Taylor | Australia's leading private lender
Before you rush off to the Accountant remember that the $300 / week you receive from the rent from the family home will be treated as Taxable income split as per the ownership of the property (I imagine Joint Tenants) so you might want to think twice.
Also not sure why you would use your cash for a deposit on an IP even if you had no other use for it at the moment.
Why wouldnt you take out 2 separate investment loans (not cross collateralised) and then place the $60K in a 100% offset account so that the funds are available to you should you ever decide to buy a PPOR or have other non deductible expenses but in the meantime will reduce the net interest payable.
Richard Taylor | Australia's leading private lender
Hi Shane
Depending on which State you are in may determine the requirements needed to act as a property developer and whether any particular license is required especially if you intend to sell your own properties.
Other issue you ned to think about is how you will finance these acqusitions as a property developer the loans will be considered Commercial in nature and as such Commercial terms and rates will apply.
Richard Taylor | Australia's leading private lender
Hi John
Yes it is but i am unsure why you would want to.
Using an interest offset account will reduce the interest charged however still protect both the access to the cash funds and the interest deductability in the case you decide to want to buy a PPOR.
No you are right the separate loan sits in behind the first loan and does not effect the payments. Has to be with the same lender of course.
Richard Taylor | Australia's leading private lender
Natalie i certainly appreciate your enthusiasm and loyalty but i assure you having sold my own property developments thru TIC between 1996 and 2004 i assure that the bargaining is not done for you.
The Developer sets the minimum price that he / she wants and the "club" take it or leave it.
We had many sales privately in the same complex where TIC where selling our properties which we price discounted below TIC price if the buyer could settle quickly or didnt have a page of Special Conditions.
TIC buyers got what was left.
Richard Taylor | Australia's leading private lender
Maybe of assistance:
http://www.devfeas.com.au/html/feastudy/feastudy.html
Richard Taylor | Australia's leading private lender
Hi John
1) In a trust structure is it possible to use the equity of a property for personal use or as a deposit for another IP?
I assume you mean where the property is owned by the Trust can you access the equity. Yes just make sure you split the loans so each can be identified.2) If the equity can be used can it be used to pay back a debt on an existing negatively geared property to make it positively geared?
Yes but there would be no sense in doing so as the interest on the loan raised on the other property would negate the benefit.3) Does borrowing the equity from an IP increase the loan repayments of that loan or is it just borrowing against the equity and is a different loan all together therefore having its own repayments?
It depends on how you structure it. You can either incresae the existing loan or take out a secondary loan. The later is certainly a lot cleaner and therefore would have no bearing on the original loan repayments as it in turn would have its own commitment.
Richard Taylor | Australia's leading private lender
Hi Ceedee
I assume the new property will be your main residence so limited advantages in buying it in Trust using a Corporate Trustee.
If you buy the property in your own names then you will get the property will be exempt from CGT shoud you sell it in the future and assuming this is your only PPOR. The property will also be exempt from Land Tax.
Financing a loan with income from a Company that has only been trading for 12 months may however prove a little harder so you might want to think about this before you proceed much further.
Richard Taylor | Australia's leading private lender
No problems Natasha.
My apologies the message only came thru late this evening.
Feel free to call me in the office should you feel we can help further.
Richard Taylor | Australia's leading private lender
HI Natasha
I am not aware of any lender that will on a construction basis to a SMSF.
Admitedly i have only done maybe a dozen SMSF deals since 2007 when the legislation changed but not aware of any lender.
Wasnt sure if you rang me earlier but if so do tell me have i answered your question.
Richard Taylor | Australia's leading private lender
As Terry mentioned buying a DFT / Company structure certainly wont aid your serviceability.
However structured correctly and utilising the equity in your own property there is no reason why you cant keep on buying.
Trick is keeping the loans separate to avoid 1 lenders serviceability wall.
Richard Taylor | Australia's leading private lender
Marissa
Yep certainly is unless you have substantial equity in your Oz properties.
Richard Taylor | Australia's leading private lender
Hi Jeff
Which state are you and the property in ?
Richard Taylor | Australia's leading private lender
Hi chriss
Firstly welcome to the forum and I hope you enjoy your time with us.
Unless you definately wish to reside in your current PPOR for even and a day i would certainly not be doubling your loan repayments or channelling extra funds into the principal reduction.
Look at changing the loan to an interest only loan with a 100% offset account and direct the extra income in the savings account.
Utilise the equity on your current PPOR to funds the deposit and acqusition costs on the new IP / 's.
Keep the loans totally separate and avoid cross collateralising the loans.
Richard Taylor | Australia's leading private lender
It is only 2 low if you intend to expand your portolio over the coming years
My current lvr is around 22% but i have no intension of doubling the number of properties i currently own.
Focus is on reducing the LVR and paying down the debt to value ration and picking up a couple of inter state properties either in
my SMSF or DFT for Capital Growth.It is a personal choice but certainly you will be limited in your growth sitting on a conservative lvr.
YI i would say after 6 months you will be bored let alone 12 lol………….
Richard Taylor | Australia's leading private lender
