Transfer of Investment loan

[WebBoard]

From: Jef .


Background:

1. Own Home. Paid off
2. Taxi plate. Produce 7% income but banks do not want to use as security.
3. Loan 200K on home for Taxi plate.
4. I am in the process of buying a new Townhouse to live in.

Questions:

If I sell my old house, I will have enough to pay off the new house except for the 200K borrowed for the taxi. Can I transfer this loan to the new house and still claim tax on the
interest?

 

[paulzag]

Reply: 1
From: Paul Zagoridis


Yes but get your accountant to be very clear about it. Document the process.

Your bank will want the $200K back unless it is a simultaneous transaction.

7% is pretty lousy in my view unless plate prices are still going crazy. What happens if/when interest rates rise?

If the taxi plate and the home is owned by you personally you should take a moment to talk to an accountant about the potential benefits of structuring yourself in a company/trust structure. This would make the documentation easier but may not be cost effective (depends on what you want to do over the next 5-10 years).

The town-house may be better in a structure.

Regards

Dreamspinner
WealthEsteem coming soon at...
http://wealthesteem.dyndns.org/

 

[WebBoard]

Reply: 1.1
From: Frank Shead


You can get an excellent no document loan which will cope with your circumstances.
Would appear you need an entrepreneurial accountant.
Email Frank as he has both
Frank Shead