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From: Ian Douglas
Hello,
I have a question for anyone , with experience in this area, accountant/solicitor knowledge, or just ANY ideas or experience at all in contracts.
I recently worked as a Car sales man for a month, pretty scary stuff ! Any way , it was good experience, I noticed when signing some contracts when the buyer was able to haggle the price down, Say from 25000 down to 22000, when the contract was written it did not say the purchase price was 22000.
It went something like this:
Purchase price : 25000
Onroads : 600
extras : ?
Discount : 3000
Balance owing : 22600
Just a very short example, Now I should have asked, but, I'm thinking to myself, does the car dealer write off the discount as a tax deduction ? I don't know.
Now I will relate this to property investing,
Say your trying to get a property from a private seller for a certain price which is below what they want.
For the purpose of loans it seems that what ever you purchase the property for, is what most lenders call the fair market value.
You pay stamp duty on that price etc...
Now what if ?
You could get the lender/vendor to agree to a contract that has the purchase price set out like this
Purchase price :$ 200,000
(vendor) Discount: $ 20,000
Balance owing : $ 180,000
The purchase price is $200K as far as the stamp duty goes, and records etc and as far as the lender goes. But you are only paying $180K
Does anybody know if this is possible , and if so, can you tell the vendor that the
$20,000 discount can be claimed as a loss and a tax deduction? as a motivation to sell?
I always write these long winded posts, but am I just grasping at straws or does anybody think I have a good negotiating idea/leverage with this line of thought.
Once again, if I have absolutely no idea, and off in fairy land, could you please replace any insulting comments with , "better luck next time"
Thanks !
Ian
Hello,
I have a question for anyone , with experience in this area, accountant/solicitor knowledge, or just ANY ideas or experience at all in contracts.
I recently worked as a Car sales man for a month, pretty scary stuff ! Any way , it was good experience, I noticed when signing some contracts when the buyer was able to haggle the price down, Say from 25000 down to 22000, when the contract was written it did not say the purchase price was 22000.
It went something like this:
Purchase price : 25000
Onroads : 600
extras : ?
Discount : 3000
Balance owing : 22600
Just a very short example, Now I should have asked, but, I'm thinking to myself, does the car dealer write off the discount as a tax deduction ? I don't know.
Now I will relate this to property investing,
Say your trying to get a property from a private seller for a certain price which is below what they want.
For the purpose of loans it seems that what ever you purchase the property for, is what most lenders call the fair market value.
You pay stamp duty on that price etc...
Now what if ?
You could get the lender/vendor to agree to a contract that has the purchase price set out like this
Purchase price :$ 200,000
(vendor) Discount: $ 20,000
Balance owing : $ 180,000
The purchase price is $200K as far as the stamp duty goes, and records etc and as far as the lender goes. But you are only paying $180K
Does anybody know if this is possible , and if so, can you tell the vendor that the
$20,000 discount can be claimed as a loss and a tax deduction? as a motivation to sell?
I always write these long winded posts, but am I just grasping at straws or does anybody think I have a good negotiating idea/leverage with this line of thought.
Once again, if I have absolutely no idea, and off in fairy land, could you please replace any insulting comments with , "better luck next time"
Thanks !
Ian
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