whats your cash flow now? Other than from work – its it actually negative?

Is that home loan all non-deductible?

could you move into an IP?

could you sell one IP, minimise CGT, keep the loan open and recycle the loan into a new investment while using the proceeds of the sale to pay off the non-deductible home loan – without closing it?

whats your cash flow now?

I think you are misunderstanding the guarantee here. There are 2 types of guarantees

a) security guarantee where property A is used as security for a loan to buy property B.

b) income guarantees where a person’s income is taken into account for a loan with someone else as the borrower.

Here we are talking about income guarantees. A brand new…[Read more]

I think you have confused things a bit Benny

A trust is not a legal entity, it is just a relationship. But for tax purposes a trust is treated as a separate entity.

So when a company borrows as trustee to buy real estate, it will be the trust the claims the interest and receives the income. The company is only the legal owner and the legal…[Read more]

When a person acting as trustee borrows they are the borrower, personally liable and indemnified out of the trust assets. If things go wrong their personal assets are at risk.

When a company is acting as trustee it will be the borrower, the company personally liable for the debt and indemnified out of the trust assets. If things go wrong the…[Read more]

That is probably just loose wording. People talk about trusts borrowing all the time, but when you dig down it is the trustee borrowing in their capacity as trustee.

What does the book say?

Keep in mind it will be difficult to qualify for a loan with that income.

What are you trying to achieve?

CGT = proceeds less cost base

cost base would be apportioned between the 2 on a reasonable basis. Might be based on land area or valuation generally.

seek credit advice. There are over 350 ways to increase borrowing capacity – but not all will be relevant to you, but a large number would. These include things such as reduce other debt, reduce living expenses, convert bonuses into salary, extend loan terms back to 30 years, get lower rates, use different lenders, low doc loans (without lying),…[Read more]

A member of a superfund could potentially buy off the trustee – but seek legal advice as many issues.

I would never consider buying a company title property myself, some do it for lifestyle reasons

in Sydney many old properties in the city or kings cross area are company title, but I don’t think a good investment generally

not if you are a beneficiary of that SMSF

Its hard to say.

Do you think the value will increase?

are you able to borrow?

Is it holding you back in some way?

Its a mistake to think a ‘trust’ equates to asset protection.

It comes down to several things such as

a) terms of the trust deed

b) structure of the trustee

c) funding the trust

d) documenting things

e) transactions

As an example I have seen many people that might set up a trust, usually with an accountant, who have never read the deed.…[Read more]

Yes I agree. But I suggest you get the deed reviewed by an independent lawyer before finalizing. Also make sure you are contracting with an incorporated legal practice so you are covered by the lawyers professional indemnity insurance. If you are supplied by a company that isn’t a law firm you won’t be covered.

I have reviewed a few of these…[Read more]

my website is terrible and they are getting all updated at the moment.

my advice is for you to seek specific legal advice when setting up a trust – from a solicitor with a practicing certificate.

1. comprehensive legal advice is needed.

2. you or the entity would probably want to borrow it if possible. no relevant information given. have you a paid off main residence? Excess cash  you can use etc.

3. heaps – death, family law, incapacity, bankruptcy, land tax, stamp duty, CGT/Revenue, serviceability, income tax, asset protection, estate…[Read more]