All Topics / Legal & Accounting / Trust fund split equity?

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  • Profile photo of msheridamsherida
    Member
    @msherida
    Join Date: 2005
    Post Count: 2
    January 14, 2005 - 9:32 am

    Hi! I am a new member as of 20 seconds ago.
    I have just finished reading ‘0-130 properties in 3.5yrs’ and have decided I can do positively geared property investments. I am attempting to make changes in 30days that will enable me to buy another investment property.

    I half own a negatively geared property in Brisbane. The other half is owned by my mother who has bought this investment property by borrowing against her home.

    So, I wish to go out and invest on my own now by refinancing the investment property to borrow a deposit against the revalued price on the property. Although, I do not want to put my mothers home in jeopardy to do so. Therefore, I am seeking advice as to setting up trust funds to protect my mums property while allowing me to borrow against the equity in the shared investment property. Is this posible and how would I set it up?
    Michael

    Profile photo of AdministratorAdministrator
    Keymaster
    @piadmin
    Join Date: 2013
    Post Count: 3,225
    January 15, 2005 - 11:59 am

    From my experience your trust has to be done first then you buy and put property in it.You would i say pay capital gains when you transfer it into a new trust.
    Not advice justfrom my experience
    can help further.
    email private.

    Regards
    toldu

    Profile photo of byronent_2byronent_2
    Participant
    @byronent_2
    Join Date: 2004
    Post Count: 337
    January 15, 2005 - 12:19 pm

    I would borrow against your current investment property.

    Set up the trust.

    Put the borrowed money into that trust by way of loan to you or your mother or both.

    Then go and find a property in the name of the trust and buy it, finance it and settle it.

    One will not affect the other. Very simple and very clean.

    Byronent
    Adelaide SA

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    January 17, 2005 - 4:09 am

    So you mum paid cash for her half by borrowing against her home.
    If you increase the loan, that is fine, but if you default for any reason, then they will come after either one or both of you to make the repayments, if you can’t and mum can’t and you have no other assets then your mum’s home may be at risk, even though it is not used as security.

    This is all very unlikely to happen. Property values would probably have to drop for a huge shortfall like this.

    I cannot see how you setting up a trust would benefit this situation in anyway??

    Terryw
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    North Sydney
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Viewing 4 posts - 1 through 4 (of 4 total)

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