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Reply: 2.1.1.1.1.1.2.1.1
From: Terry Avery
Hi again Robert
Thanks for that reply. Just on the bank lending side of things. It would seem incredibly lazy of the bank not to have a valuation done just on the basis of the “apparent” LVR being 50%.
If that was the case there would be nothing to stop me from buying an IP for $200k and flipping it to my trust for $400k with the trust borrowing 50% of the $400k (the $200k purchase price). I would then have obtained the property at market price with 100% borrowed from the bank. The legals and stamp duty would come out of my pocket. You could repeat this monthly or even weekly if you had numerous trusts and approached different banks. You would need a trust for each one because of the credit checks the banks do.
One further point. Just because many others are doing doesn’t mean the ATO may look unfavourably on the structure. Just look at the people caught up in the mass marketed schemes recently.
I look forward to any comments from Dale on this.
Cheers
Terry
From: Terry Avery
Hi again Robert
Thanks for that reply. Just on the bank lending side of things. It would seem incredibly lazy of the bank not to have a valuation done just on the basis of the “apparent” LVR being 50%.
If that was the case there would be nothing to stop me from buying an IP for $200k and flipping it to my trust for $400k with the trust borrowing 50% of the $400k (the $200k purchase price). I would then have obtained the property at market price with 100% borrowed from the bank. The legals and stamp duty would come out of my pocket. You could repeat this monthly or even weekly if you had numerous trusts and approached different banks. You would need a trust for each one because of the credit checks the banks do.
One further point. Just because many others are doing doesn’t mean the ATO may look unfavourably on the structure. Just look at the people caught up in the mass marketed schemes recently.
I look forward to any comments from Dale on this.
Cheers
Terry
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