Buying out house from fiance in breakup victoria

[startingnow]

Hey guys, not sure where this thread belongs, but i thought this one seemed appropriate. I have seen a similar post on here, but it was for qld.

My fiance have had a very friendly breakup, and i we have come to an agreement that i can buy her out for $50,000. After doing a quick few calculations, i have seen i can continue to service the loan now as is...buuuut...

A friend has told me i may need to pay CGT again as its seen as im buying her half of the house out. Is this true?

Also is there anyway i can just remove her name off the loan? As i have heard if i have to refinance i will have to pay the CGT aswell.

So my real question is. We have an agreement between us of me giving her $50,000 and she will go and do her thing. Whats the best way i should go from here to formalise it all at minimal cost?

Thanks soo much for anyones advise. Its going to be a little tight for awhile, so any money i can save on fees etc would be greatly appreciated.

starting now (again lol)

 

[Kristine..]

Hello SN

Sorry to hear your news.

Breaking up - no matter how friendly, is always hard to do.

You will need to show the lender that you can afford to take your friend off the loan and continue to be able to service the debt

There will need to be

Transfer of Land – this can be a Matrimonial Transfer under the Love & Devotion exemptions ie no Stamp Duty payable. If you have no or minimal experience, get a quote from a Solicitor/. Conveyancer to handle this for you, they will also attend Settlement on your behalf if this is necessary

If this was your Principal Place of Residence and one of you is remaining in occupation, then this does not(usually) trigger a capital gains tax event (ring the ATO for more information – the Enquiry Team are very helpful)

You will need to raise $50,000 to pay out her share

You will need to
(a) Demonstrate to your lender that you can service the current mortgage by yourself – this is an Internal Refinance of the loan (b) Service the increase borrowings by yourself

If your current lender considers that you cannot service the current or increased borrowings then you will probably need to look at refinancing to another lender with a different servicing calculator


Stop listening to inexperienced friends. Everyone will have an opinion, which will usually be wrong and simply cause you distress. Talk to the people who will be helping you with the practicalities - your broker / banker, your conveyancer /solicitor, the Vic State Revenue Office, and the ATO.

These are the only opinions you can rely on

Hope this helps
Kristine

PS - Your friend say you will have to pay CGT 'again' - as you have not paid CGT at all you cannot pay it 'again'.

 

[jrc]

Assuming you nad your fiance have been living together then there should be an exemption from CGT and stamp duty if your agreement is registered. SEe a lawyer to do something quick and simple

 

[EarlyRetirement]

See a family lawyer - you should get either a Binding Financial Agreement or Consent Orders drawn up. Both documents will get you the stamp duty exemption (and there won't be any CGT payable) and will protect both of you from having the other making a property settlement claim later down the track.

 

[startingnow]

Thank you everyone for your responses. They have been soo helpful and we are both very greatful.

Update: I went to the bank today and there shouldnt be any trouble sorting out the new loan. It will be tight, but if i get a housemate, it shouldnt be too difficult at all. I just have to get a stamp thing approved, or sorted out by a conveyencer. He said it was a simple task, but i assume there must be a reason people use conveyancers?

Im very happy to hear that i wont have to pay the stamp duty again or CGT, which will make life a little easier.

Thanks soo much for all the help. I owe you all a big round of drinks