Hi out there in the world of Property Investing!!
Just want to get some discussions going!
I need some advice of 2 things:
1. Setting up a trust between partners
2. Sourcing capital for 1st investment property
Firstly, a bit about us, we are a young couple in early 30's looking to create wealth to share with family and friends.
Wondering how do I go about setting up a trust between my partner and I. Do I seek professional assistance and if so is it a solicitor or accountant or both that I make an appointment with?
I’m putting it out there; would anyone know any professionals in Sydney metro that we could discuss this with?
Secondly,
We have found a property that will provided our goal and is inline with our stratergy. The question is how to get access to capital for the deposit & closing costs. We both have equity tied up in each of our properties. One is a PPOR with approx. $100k (20%) in equity the other is an IP with approx. $75k (30%) in equity, also with that we have a combined savings of $35k.
Can any one give some intelligent advice on how to harness the equity in our properties to get an IP?
Thanks in advance!PC77
Hi PC77
Firstly welcome to the fourm and i hope you enjoy your time with us.
In regards to your first question you are certainly better off to consult an Accountant who can weigh up your requirements and recommend a suitable vehicle. Just educate yourself a little before you go and see someone as many clients end up buying a Trust structure and then realise the issues in either financing the new property (not applicable for a simple DFT or UT structure) or dont understand what they can and cannot do in regards to any potential negative hearing claims.
Realistically the only way of accessing the equity is to take out a sub loan on one of the properties and use this is as deposit and to cover the acqusition costs. Sounds like the IP might be rather tight although have more available equity in the way of percentage terms so looking at the PPOR might be the way to go.
If you dont need all of your current savings you would be better of to pay off some of the PPOR loan and then increase the sub loan accordingly. I.e pay down $20,000 and take out a equity loan of $20,000 plus the extra funds to take the loan to say 90% lvr.
Dont use your own savings especially when you still have non deductible debt outstanding.
Of course without further hard data in regards to the purchse price of the new IP / where it is located it is difficult to comment further.
Not knowing with whom your current loan is with makes assessing whether they will do a 90% equity loan hard so such recommendation needs to be quantified further when additional information is to hand.Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
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