Can I Transfer IP with a mortgage to daughter

Discussion in 'Wills & Estate Planning' started by darrelj, 2nd Jun, 2020.

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  1. darrelj

    darrelj Well-Known Member

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    Assume I own an investment property which was purchased on a mortgage for $325,000 and I still owe that entire amount on the loan. I wish to transfer this to my daughter in about a year when her current employment changes to an ongoing permanent position. She had been working for 9 years on a full time ongoing position but since the last year she elected to resign and continue to work on contract basis (with same employer). Not much money saved too.

    What is the possibility of transferring this property to her . How can I materialise this. I am prepared to go all out to help her.
    Like to hear your advice.
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    You will need to address the following (& more).
    • Will she qualify for a loan?
    • Will the bank release you from your mortgage?
    • Can she afford the stamp duty on the property?
    • What is the market value (both for stamp duty and CGT)
    • Legal & financial advice?
     
    Ted Varrick likes this.
  3. Trainee

    Trainee Well-Known Member

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    Questions to ask your lawyer etc.

    Can you hold the loan while she gets the property? (Probably not.)

    do you have the money to repay the mortgage and then transfer the unencumbered property to her?

    Alternatives such as renting to her? Impact on deductibility to you?

    what are you trying to do and do you understand the consequences?
     
  4. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    You can. But a transfer of title will trigger CGT and Duty and new loans needed and mortgage discharged and relodged.
     
  5. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    When you get down to it, it's probably not a simple 'transfer to your daughter'. More like a 'sale to your daughter' and everything that this may entail. Taxes, stamp duties, mortgages, etc.