All Topics / Help Needed! / What happens when two people swap properties

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  • Profile photo of mark76gmark76g
    Participant
    @mark76g
    Join Date: 2003
    Post Count: 46
    June 14, 2010 - 8:05 am

    Hi,

    I was wondering how things work when two people swap properties.
    For example.
    I own an apartment worth $290,000 with a$185000 mortgage as somebody else
    want to swap with me for a piece of land they own outright worth about the same amount.

    How does the transaction proceed. Does it count as a sale and all taxes apply.
    If so couldn't we both underestimate the values of a realestate to reduce the taxes.

    I assume my bank would also have to be sympathetic enough to swap my mortgage to the new property.

    Has anybody done this before.

    Mark.

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024
    June 14, 2010 - 8:39 am

    Hi Mark

    Yes would simply be considered as a Sale and new purchase so whilst if done privately there would be no Selling agents fees there would be Transfer duty payable.

    CGT maybe payable and your Bank unless the loan is portable would need to start again and assess your application. Mortgage Registration fees would also be payable.

    Richard Taylor | Australia's leading private lender

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    June 14, 2010 - 9:04 am

    stamp duty at market rates too.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

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