Forum Replies Created
Thanks benny!
Yes I have the newest edition of the book, although I was mainly quoting from 0 to 260 properties.
I’ve gone to reread chapter 9 and it makes more sense – debt held by the trust is not recorded against the guarantors financial record, hence he can ‘recycle’ his income by setting up new trust structures.
One issue outstanding is whether acting as the direct trustee of a trust differs from using a company trustee – if I act as the direct trustee would loans taken out by the trust be reflected on my record?
Thanks!
SingThanks for that!
I’m trying to understand Steve Mcknight’s comment in his book, that using a trust allows him to “leverage his income to increase his borrowing ability”.
If the serviceability of a family trust is dependent upon the debt and income of the guarantor, how does this differ from taking out the loan in my own name? At the end of the day the total debt is the same, and there is only a certain amount of income, whether it flows from me or from me to my trust?
Thanks for any clarification!
Hi all
Thanks for the info. Due to the nature of my work (have to move alot) we’re not looking to get a PPOR.
At this point would buying a property with a family trust make any difference or cause issues with serviceability?
Understand that the main benefits right now are asset protection and tax structuring (for positive geared assets).
Thanks
SingThanks richard!
Regarding this:
How does the bank decide how much can be loaned to the Family Trust, since the trust does not provide any income? Would it be based on my serviceability (acting as the guarantor)?
Yes your personal income would be taken into consideration together with your personal expenses and any rental income / loans etc the Trust currently has.
I have read that taking a loan out in the name of a family trust maximises serviceability, as I don’ take on additional debt in my own name.
However, does this still apply if I act as both the trustee and the guarantor?
REgards
Sing
