Thanks mini,

it’s clarkr at powertel dot com dot au

Rod.

Well you’re entitled to vacant possession and you’re entitled to receive market rent.
It’s up to you to enforce it.
Get a property manager to draw up a lease and get it signed prior to the settlement date. If the vendor won’t agree to pay market rent then insist on vacant possession. Talk to your solicitor.

Rod.

I’m not an accountant either, but I’m pretty sure Terry’s right.

If you don’t distribute the funds then the trust will be taxed at the max rate. If you do distribute then the company will be taxed at the company rate. Either way they will be taxed somewhere.

Rod.

4 at the moment, hopefully some more soon.

But only if the numbers work.

Rod.

Andrew,

thanks for another great inspiring post.

In many ways your posts are more relevant to many of us here as you are still doing things that we can relate to. Whereas often Steve seems to have already moved to a higher plane (bulk finance etc.).

Rod.

Interesting read, I was also surprised at the low percentage of wraps. Steve seems to push the wrap side of things more in his posts here. Maybe the wraps are just to provide the cashflow to finance deposits for the buy and holds which are the real “wealth builders”?

Rod.

Stu,

You’re right some of the ongoing fees with LOC’s can be expensive. (I think CBA’s are $12 per month!).

Westpac’s seems alright. I’ve got a mix of LOC’s and basic/offset loans and pay the same interest rate on all of them with one annual fee ($300) on their professional package.

I’ll be interested in seeing your article.

Amit,

Davo70’s done a good job of describing the LOC – a big credit card secured against property. And just like a credit card they can be very dangerous. I agree with Davo70, I like the flexibility for investment purposes, but if I was paying off a PPOR as well (which I’m not) a 100% offset loan would probably be a better bet.

Rod.

Hi D,

You’ve made valid points. Personally my LOC is completely seperate from personal funds and any withdrawals from it are only used for investment purposes- thus keeping the interest tax deductible.

Rod.

I’d suggest LOC, it gives you the best of both worlds.

With most LOC you have the option of only paying the interest or paying down principal if you wish.
Which can easily be redrawn if required.

Some of the straight IO loans have limitations on the amount of principal repayments that can be made per year.

The main downside with a LOC however is that you usually can’t fix the interest rate.

Rod.

Westan,

When are you going? I may have to go a week before you otherwise you’ll get all the good properties. []

Rod.