I use a LOC on my PPOR. But I do not deposit incomes etc in there. I use it merely for investment expenses and deposits.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
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Yes, I was suggesting 20% above what you pay for it. But you can vary this as you please. Some people believe you should not be making a profit when onselling a property. But you have to account for costs such as stamp duty and make a profit or it would be pointless.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
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Maybe get a professional in. That way if something happens, their insurance should cover it,.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
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No.

What is someone sues you for farting in an elevator, and you go bankrupt. Your trust assets will probably be safe.

If you decide to stop paying the trust loan, then the bank will come after it, and then the guarrantor if there is not enough. This is expected, and fair.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
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Hybrid trusts are a mixture of discretionary and unit trusts. They work well because the unit holder can borrow to buy the units in the trust and claim the interest against their own personal income. This effectively allows negative gearing using a trust. This is not normally possible as trusts cannot distribute losses.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
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Asset protection is due to you not owning the asset. You are holding it on behalf of the beneficiaries. If you were to be sued, the trust assets would (probably) be safe. So even if you went bankrrupt, you may not lose these assets.

Tax advantages are due tot he fact that the trustee can choose who to pay the income to each year. eg. one year a wife may be off work after having a baby, so all of the income can go to her. The next year, she goes back to work and the husband takes a break, so all the income can go to him. The first $6000 will be tax free. If you held the assets in your name, or in a company this would not be flexible.

Estate planning. When you die, you may leave your investment properties to your children. This may trigger CGT to be payable. If a trust held the assets cannot be willed at death. The trust is just handed over to the new appointer and trustees.

There are costs to setup a trust – from $275 to about $10,000. There may also be yearly costs for extra accounting work and ASIC returns etc if a company.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

Steven

Thats the First Mac one. I think notabrokeranymore may have been referring to another 95% low doc?????

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
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Probably not. Mainly for taxation reasons.

See you accountant about this. But basically you should buy you house, and then use this as security to borrow more money to buy the investment.

If you do it the other way, you will be paying interest on your home loan which you can’t deduct.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

Depends on your situation.

I would put it into my home loan, if I had one. Or a 100% offset account. dpending on what sort of properties you are after, it is probably not enough for a deposit.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

A discretionary trust can stream the income and/or capital gains to any of the beneficiaries. So you, the trustee, distribute to the lowest income earners first saving tax.

Be aware that the beneficiaries will have to declare this income in their tax returns and the money belongs to them if they decide not the give it to you.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]