Depends on the state it seems. From what I hear, WA are very strict. I have done it in Vic with no problems, but there is a requirement to have a written agreement with your nominee before you sign the contract – or there used to be.

Terryw
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Don’t think Steve’s product has anything on Hybrid trusts in it.

For more info on hybrids go to http://www.lawcentral.com.au and go through the process of making a deed, and read all the tips available – all for free.

Also look at http://www.chrisbatten.com.au

Terryw
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NEVER beleive an agent!

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Hi

Have a look at this from the ATO site. it is in relation to shares, but the general principles would probably apply to property:

Holding shares or actively trading: what’s the difference?
http://ato.gov.au/distributor.asp?doc=/content/76071.htm

If you could be classed as a trader, you could probably claim stamp duty as an income expense in the year it is incurred.

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Companies are generally not recomended for ownership of appreciating assets. This is mainly due tothe fact they do not receive the 50% CGT deduction for assets held more than 12months.

Being non residents, there maybe many issues with controlling trusts and companies and taxation of these, so you would need to seek good advice.

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Cash bonds are annuities. Steve Navra used to promote them a lot as a way of increasing servicablity.

basically works like this:
You buy a $100,000 annuity, payments over 5 years. each year you would get back around $20,000 plus interest, maybe $24,000pa.

With some lenders you could have used this $24,000 as income even though really only $4000 is income and the other $20,000 is your principle coming back. The increased ‘income’ thus increased serviceability.

The trouble with this is the banks were only giving about 5% on the annuity, but you were being charged 7% to take the money from a LOC, so there was a shortfall.

There were also expensive fees to set it up.

These days there are many Low Doc and No Doc products out there, and these have decreased teh popularity of the cashbond method.

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Ok, you should probably get the valuation done on your property first, otherwise, you may come in short of funds if your valuation comes in lower.

I spoke to a loan assessor today at a major bank, and he said 80% of valuations for loan increases and refinances were coming in lower than expected.

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You generally cannot borrow more than the house is worth. If you have the money for 20% now, why not borrow 95% and keep some money for renovations?

If you buy at auction, then the price you pay will be market price! It may be hard for you to get a valuer to value it more in the short term. If they do, banks will generally want you to wait 3-6 months before they will increase you loan. BUt you could always refinance with another bank and do it that way.

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Be very careful with written offers, if it is accepted, you could have a binding contract – which you may not be able to exit.

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There are two main LMI companies, maybe your current lender is only using one of these? Which lender are you using?

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