It is very common to see $1000 put down as a deposit. $1 is not so common, but I have done deals where there is no deposit until the contract goes unconditional. So you would put down say $100 now with the remaider making up 10% when the conditions are met – subject to finance etc. And it doesn’t have to be 10%. COme to think of it I have seen the…[Read more]

not a good idea to borrow cash and put it in an offset account as you could lose the deductibility of interest.

best to set up a LOC or an IO loan that you can draw down when needed.

Can’t come up with $1?

The no vesting date – any trust set up in SA doesn’t have to have a vesting date. In theory it could go on past 80 years, but just because there is no vesting date doesn’t mean it won’t vest. A beneficiary can force it to. But would SA law apply to a trust set up in QLD which nominates SA as the applicable law? Would the trustee need to be located…[Read more]

I looked at the legislation recently and there are some concessions for NZers. Just google ‘stamp duty act vic’ and have a look.

Yes, you could put down an offer which involves a long cooling off period, subject to finance, subject to building inspection etc. This way you can pull out and get your full deposit back if you cannot meet the condition.

Another option is to use an option agreement, but this is for more longer periods.

This is a legal question

There is no gift tax in Australia. The gift to the children will be tax free. But this will not effect the CGT on the disposal on the property.

But before he does this he should seek legal advice as there are wide ranging consequences. Depending on the circumstances he may be better off lending the children the money,…[Read more]

Yes many ways to set this could potentially.

First, try a different lender
Secondly, ask the bank what you could borrow without the wife. See how much the short fall is
thirdly, is it possible for your wife to borrow on her own and lend you and the other person the money.
4th – it is possible for you to borrow some on other property and lend your…[Read more]

Why are they asking for a guarantor – are you using other property which you wife partly owns as security or is it because of servicing?

You should keep your wife right out of it if possible. You don’t want her exposed to other people’s debts and it would adversely effect her future borrowing capacity.

No it doesn’t if by ‘partner’ you mean spouse. If not a spouse then you would not find a lender I think.
Not all banks allow this either BTW – AMP recently insisted that they would only lend to my clients if they purchased at least 90/10 together but not if just 1 was on title. All the majors should be fine.

Selling one house to buy another will result in losing about 10% of the value in transaction costs plus you would trigger CGT and have to pay this. Both means less capital is compounding for you. It may still be worth doing however, depending on the situation.

For financial planners in VIC check out Dovers/McMasters who advise on property.

If maximising her pension is the goal it would depend on how much cash she comes out with. If a small amount it won’t make a difference. If a larger amount it might be worth her while buying a main residence.

Yes, I agree with Corey. You would be throwing tax savings away by using your cash to invest.

You mean if you buy as trustee of a trust?

it will depend on the state legislation where you are buying, but you would generally qualify I think.

no.

who pays the ongoing expenses? what about land tax?
How you thought about ownership structure?
How will you fund the deposit?
Do you expect the values to increase?
Any options to renew?
Have you had the lease reviewed?
What is the cash on cash return?
What is the opportunity cost of investing in this – tying up deposit, using borrowing capacity etc.

You should consider GST still. It may not apply on the eventual sale if after 5 years, but there are other issues.

There is generally no CGT on subdivisions – but just income tax. Don’t forget to factor in GST too and you also need to consider structuring the loan so as to maximise deductions. you need specific tax advice.

The end result will be the same either way. You will be paying interest on all loans until the old main residence sells.

You can buy the new property as the main residence and get the reduced stamp duty. A bridging loan won’t change this.

Go for the one with the lower interest rate.

A an oral contract for land is generally unenforceable. It needs to be in writing, but this doesn’t necessarily need to be a formal contract, it could be via email or the back of an envelope. Best to ask your lawyer.