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  • Profile photo of Tarek BaytiehTarek Baytieh
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    @tarek-baytieh
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    January 13, 2012 - 1:24 am

    Thanks Midsomer – i'm known for being pedantic so was just making sure that while it may have appeared obvious, i was just clarifying that this in fact was the case – especially given the discussion around cross-collateralisation… ;)

    Thanks Tige – all good in that regard then!

    In relation to the Agreement, i would always recommend formal Legal Advice in relation to these matters – a few hundred $$$ now could save you a lot of potential angst down the track.

    Take Care
    Tarek

    Profile photo of Tarek BaytiehTarek Baytieh
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    @tarek-baytieh
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    January 13, 2012 - 1:20 am

    Oh, and just in addition to this…

    Loan A = PPOR (joint names), Loan B = using equity from PPOR to pay for purchasing costs (in fiancees name)

    Loan B cannot be just in Fiancee's name if secured by PPOR that is in 'Joint' names… Loan B must also be in 'Joint' names unless Tige acts as a 'Security Guarantor' for Loan B…

    Take Care
    Tarek

    Profile photo of Tarek BaytiehTarek Baytieh
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    @tarek-baytieh
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    January 13, 2012 - 1:15 am

    Thanks Jamie…  Please explain which part confused?  Perhaps it was just the lack of terminology used…

    Tige specified the need to 'Borrow the full purchase price plus costs & NOT to use any of our personal savings' yes? 

    AND

    To keep the properties from being cross collaterised, Loan A = PPOR (joint names), Loan B = using equity from PPOR to pay for purchasing costs (in fiancees name) , Loan C = new loan to cover the cost of the house (in fiancees name).

    To me this sounds as though she wishes to borrow 100% + costs (obviously).  If loan C is to cover the purchase of the new property WITHOUT cross collateralising, then where is the 'Deposit' to do this coming from…?  Loan B is stated as 'Purchasing costs' but no mention of 'Deposit'… I can only assume by your responses that 'Purchasing Costs' included 'Deposit'?

    Structure is fine – not debating that – just clarifying where the actual 'Deposit' is accounted for.

    Look forward to your thoughts!
    Tarek

    Profile photo of Tarek BaytiehTarek Baytieh
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    January 13, 2012 - 1:00 am

    Hi w8

    Couple of things here…

    1:  Are you sure you have a full understanding of the '6 year' rule re CGT?  If not please make sure you have your accountant explain thoroughly as it is not a simple 'rule'.

    2:  I would do what Richard has suggested and clean it up now ie make your properties stand alone if that's what you really desire.  In saying that though, 'cross-collateralising' has its place and benefits, and in fact it can be used effectively to simplify your lending structure.  If you're lucky enough to be in a position to have your properties stand alone, then all well & good.  But nothing wrong with C/C if required. 

    3:  If you're obtaing a new loan with another lender for another property, i can only assume that you're contributing a deposit of some description?  Hence what you do with CBA is irrelevant (in terms of structure).

    Take Care
    T

    Profile photo of Tarek BaytiehTarek Baytieh
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    @tarek-baytieh
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    January 12, 2012 - 5:13 am

    1) Anz 95% lvr requires the borrowing to have held a retail lending product with the Bank for at least 6 months and it is 95% less LMI.

    Richard, ANZ cap LMI to 92/97% respectively…

    AVRANJES: She could always consider splitting her Home Loan to a 50/50 split or similiar.  I would leave a portion as Variable to allow for additional repayments that could be redrawn at a later date if required.

    Good luck & take care!
    Tarek

    Profile photo of Tarek BaytiehTarek Baytieh
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    @tarek-baytieh
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    January 12, 2012 - 5:04 am

    Hi Tiger

    To keep the properties from being cross collaterised, Loan A = PPOR (joint names), Loan B = using equity from PPOR to pay for purchasing costs (in fiancees name) , Loan C = new loan to cover the cost of the house (in fiancees name). (Does it matter if loans A-C are with the same bank?)

    Let's just clarify… you wish to borrow 100% + costs (no problem here).  Loan A sounds okay.  Loan B sounds okay.  Loan C – if this is to be 100% of the purchase price, then it would be crossed with the PPOR. If it is to stand alone, then Loan B will have to include the 'deposit' to allow C to stand alone (or a loan D against PPOR).  Does this make sense?

    Good luck & Take Care
    T

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