Forum Replies Created
Matt
I will then claim the interest as an expence and the "repayment" as income, so that way it is all tax neutral (personal tax) ?
All depends on what type of Trust you have set up. If it is a DFT then the answer is NO.
Richard Taylor | Australia's leading private lender
There are many reasons why client wish to utilise Lodoc / Nodoc style products so drop me a line and I can give you some suggestions.
Richard Taylor | Australia's leading private lender
No real benefit in having 2 offset accounts so put everything in the one.
Probably an idea to start speading your sik and looking at new lender for your IP's
Richard Taylor | Australia's leading private lender
Salary should definately be going into the offset account not the LOC.
With regards to the interest repayments on the new IO loan linked to the offset account this will depend on whom the loan is with. The type of offset account will vary from lender to lender.
Some reduce the interest charged others you maintain the same repayment and the debt balance reduces which is of course not ideal on an IP.
Richard Taylor | Australia's leading private lender
Hi Robin
Quick answer
Is this possible? Yes it is under a SMSF
Approx what are the set up fees for the SMSF? All depends on your Accountant but a Deed can be set up for around $1500 max.
Approx what annual accounting fees? All depend on how complicated the transactions within the fund are and how much time your Accoutnant spends on the return. A SMSF needs to be Audited each year and there are few other ASIC requirements and levies. Allow $2500 / annum max.
How would I get started? Get your Accountant to form a Trust Deed, open the Bank Account and Transfer your existing funds proceeds to the SMSF.
Would i need to pay stamp duty? Buying in a SMSF is like any commercial transaction so YES you will need to pay stamp duty on the land. Remember you are unable to gear on a vacant block of land in Super and cannot borrow to build so need to think carefully about what you do.Richard Taylor | Australia's leading private lender
Matthew
Sorry only just seen your post.
Can you email me the request as i am doing about 40 a day at the moment and am likely to forget.
Also need your email address to send it back to you anyway.Richard Taylor | Australia's leading private lender
Yes exactly would suggest that is the way forward.
Richard Taylor | Australia's leading private lender
Nulify the advance repayments and if the line of credit is used to fund the deposit for an investment property or other investment then the interest will be deductible.
Richard Taylor | Australia's leading private lender
Simply boils down to the purpose of the original funds.
Unless the original loan was an investment loan interest on a redrawn amount on an owner occupied property is not deductible.
If the loan had been an interest only loan with 100% offset then you would have been fine.
Need to separate the 2 account hence our suggestion of a line of credit.
Probably need more hard data to advise further.
Richard Taylor | Australia's leading private lender
Hi there
Unfortunately it is too late to do this as the funds on the redraw wont be tax deductible.
Be better off to set up the line of credit for the increased amount.
Your Broker should be able to do this for you.
Richard Taylor | Australia's leading private lender
Hi there
Yes it would be a separate loan but on the basis that 20% plus costs came to 200K then Yes the total loan balance on the first property would be $500K.
Interest is only charged on the drawn down balance so assume that you had fully draw the loan of $200K then interest would be charged on a daily basis on the full amount.
Richard Taylor | Australia's leading private lender
Hi Tia
Normally what we suggest to our clients is that they establish an investment line of credit against the security and use this to draw down and fund 20% of the purchase price of the new investment property and acqusition costs.
Then on a standalone basis take out a separate interest only loan for 80% of the new purchase price on the security of the investment property only.
Repeat for each new property.
Richard Taylor | Australia's leading private lender
Hi Jack
Any chance i could get you to email that request again as have deleted it from my Blackberry / desktop by mistake.
Richard Taylor | Australia's leading private lender
Hi Sonya
Yes i own 2 large blocks myself and have financed many for clients.
If under 4 in the block you will get normal terms and conditions however 4 plus will limited to reduced lvr's.
Richard Taylor | Australia's leading private lender
I am with Terry sounds like an absolute mess to me and a red flag to the ATO.
I would be avoiding the Banks as they would have no idea on loan structuring but keep things simple and separate.
Use an offset account for non deductible debt and maintain good records.
As long as you can support the loan by way of income there is no reason why you should be paying a higher interest rate.
Richard Taylor | Australia's leading private lender
Tommy without being funny i would only talk to the OSR and get it from the horses mouth as your Bank and Broker arent the ones who will incur the fine and have to pay the FHOG back if the OSR disagree with your interpretation.
Richard Taylor | Australia's leading private lender
Tommy
Hate to say from what i read she will not qualify for the FHOG and if you claim it run the risk of being audited simply because you refered to her as your fiance and this in its own right disqualifies her.
Richard Taylor | Australia's leading private lender
Depending on the equity involved probably wouldnt need to go through non traditional lenders but without actual hard data it is difficult one to advice on.
Nodoc and very very lodoc is still around JUST.
Richard Taylor | Australia's leading private lender
Firstly welcome both to the forum and i hope you enjoy your time with us.
Trish no you dont need to go through an agent to purchase a property or indeed rent the property but in saying this of course you would need to locate a vendor who is selling privately if you wish to bypass an agent on the sale. His commission is of course paid for by the seller and not you so as long as this isnt factored into the price then they are not all that bad to deal with.
In regards to getting your children rent the property from you certainly no need to use a letting agent. If you wish to formulate a Tenancy agreement with them (and it is probably a wise move to cover yourself from the ATO) you should be able to download a sample from the local Tenancy Authority in your State.
Now BJR there are plenty sources of free information available on areas, type of property etc so do as much of your own research as possible. Most mortgage brokers do not charge for their services so this is another area of free information in regards to lending institutions and their varying range of products.
Read and educate yourself as much as possible and talk to others you will be suprised on how quickly you start to learn.
Richard Taylor | Australia's leading private lender
All boils down to equity.
Couple of lenders till left that will advance funds on a reduced LVR where no traditional evidence of income is required however all depends on the overall deal.
Also i guess should you be borrowing if you feel you cannot pay it back ?
Without further hard data it is difficult to comment further.
Richard Taylor | Australia's leading private lender
