Lender requesting title change from a Trust to Individual names

G'day Folks,

We are in the the process of borrowing to subdivide and build 2 dwellings on a property in BNE.

We have a pre-approved loan from a small bank with the subject to the following "Copy of draft title transfer document showing relevant transfer information for property from title in the name of trust to individual applicants' names"

Its a unit trust which is owned by me and my wife.

We have a few properties under the trust and I don't want to move the titles from the Trust and if we do I am certain we will be hit with Stamp Duty in QLD (is that a correct assumption ?)

Transfer duty estimator

If we were to pay stamp duty do we pay based on the council rates ? (if so we are looking at ~14K according to the calculator)

We are from BNE but live overseas and our mortgage broker has informed us only one small lender will recognize my income.

Any guidance would be highly appreciated.

Thank you for reading.

Sulo G

 

A trust is not an entity so that would be impossible to do. I assume they mean trustee?

And lenders do not just demand title transfers out of the blue. Why have they asked this?

If you are overseas you are probably in breach of the corporations act.

Changing title won't necessarily mean duty or cgt.

Have you had legal advice?

 

Why would the Corporations Act be relevant here?

 

My guess is that there is no resident directors of the trustee company. I have come across a few of these in my travels. Someone sets up a trust and buys a property and later goes overseas not thinking about the consequences.

 

@Sulo who is the trustee of your unit trust? You and your wife as individuals or a corporate trustee? If it’s a corporate trustee this may be the issue,

Directors
Under section 201A of the Act:

• a proprietary company must have at least 1 director, and that director must ordinarily reside in Australia

What is the name of the Property title holder on your tile? Is it XYZ Unit Trust or ABC Pty LTD ATF XYZ Unit Trust?

 

Trusts can't be recorded on title. It would be ABC Pty LTD

 

That's putting it politely!

 

Yes, I am aware, just wondering what they think is on their title!

 

Thank you for your insight.
Both me and my wife setup the unit trust 12+ years a go. We are based in Qatar atm so the income is in QAR. We did purchase a property under the trust with a different lender few years a go with no problems. Its the smaller lender seems to be asking for the title change.
I am in the process of getting legal advice on this matter.

 

Income Currency QAR

 

Yes we did set it up 12+ years a go when we were living in BNE. Now based in Qatar for work reasons.. but will be back to BNE next year.