Hi all,
First post here following some reading of other posts on the forum.
Current situation:
Have PPOR and one IPPPOR (value $750,000 in Dec 2007) – LOC (smart) home loan with ING for $181000 – approximately $105,000 owing. $80,000 was used for deposit + associated costs for IP so approx $25,000 owing on PPOR.
IP (unit purchased for $348,000 in Dec 2007) – IO mortgage simplifier home loan with ING for $278,400
Questions:
1) From what I have read in the forums the LOC against the PPOR is a bad setup especially from a tax perspective – I currently keep a track of money in and out of the LOC account via a spreadsheet but would prefer that it is structured properly – how best to do this?2) Wanting to purchase a second IP (say $450,000 to $475,000 range + associated costs). How best to incorporate this into the above re-structure?
3) I think we are going to need a mortgage broker for this. However, our experience with our last mortgage broker wasn’t exactly great – so hesitant to use another without recommendation. Any recommendations? (Especially for a broker that understands loan structuring around investment property.)
Many thanks.
eraser
There is a tax ruling which you could rely on to fix things now. If you can demonstrate how much of the loan is related to investment v non investment you can split the loan.
So what you hsould do is to split the loan into 2, one being the investment portion and one being the personal portion. You can then add on a LOC separate to these for the next purchase. This should only be used to pay the deposit and costs and then the main loan for the next portion be set up as a separate loan at 80% LVR interest only.
If you are in Sydney I may be able to help – soon – I am a solciitor and soon to be mortgage broker.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi Eraser
Yes not an ideal set up i must admit.
I think it would be a good idea to untangle the 2 loans and set up the IP deposit properly before you make the offer on the next property.
Sorry to hear you last experience of using a Mortgage Broker wasnt too good. Hate to say like any industry there are always going to be some bad apples but hopefully we are raising the standards by the day and a lot of the poorer ones have left or are on there way out.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Qlds007 wrote:Hate to say like any industry there are always going to be some bad apples but hopefully we are raising the standards by the day and a lot of the poorer ones have left or are on there way out.I think a few hundred would have voluntarily exited the industry in the last month alone….
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Whats going on Jamie? Why is everyone leaving?
I am just about to become a broker again.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Terry i must say i scratched my head when i read that and asked myself why oh why.
As i think as Jamie and i have mentioned before when you are not filling out Preliminary Assessments, typing out quotes, undertaking Diplomas and updating your CPD points or getting ready for an ASIC suprise audit you get chance to write some loans.
The further amendment to NCPP October 1 i think was the last straw with many who just "You have to be kidding me" and left the industry. FAST who i am with have lost 20% of their Brokers since July and with FAST like Plan you are left alone to do your own thing so not a matter of being a newby these are hard core Brokers who have decided to exit.
I am sure you will find Law is less bogged down in paperwork than Mortgage Broking lol
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
hi Richard,
Good question. I am working with structuring and setting up estate plans for people and loans are a big part. There are so many silly brokers out there and so many people are simply throwing their money away by paying too much tax because they haven't got a simple part of it correct. Now I can give tax advice and legal advice and credit advice and SMSF advice, but will leave out the financial advice for now.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Totaly agree with you.
Same in the Financial Planning industry i find the number of selfish money grabing planners out there means if you do the loan correctly the financial planing work walks in the door.
God we are gluttons for paperwork lol
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Gluttons for continuing education points too.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Yes when i look at a working week i am amazed how many hours i spend reading things i already now or completing information on forms that clients never ever read.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Qlds007 wrote:Yes when i look at a working week i am amazed how many hours i spend reading things i already now or completing information on forms that clients never ever read.Cheers
Yours in Finance
Amen, it must be a tad overwhelming at the clients end as well when they see a thousand forms emailed them to them before we can go ahead and submit their deal. I’m sure ASIC will come up with a couple more just to keep us on our toes.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
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