Personal loan for stamp duty? Already gone unconditional on the house with lending approved and can

Discussion in 'Loans & Mortgage Brokers' started by ChrisG, 2nd Jan, 2019.

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  1. ChrisG

    ChrisG Active Member

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    I'll still have the loan to pay and the cost of another car. Current car was bought for 24k, doubt it will get much on the secondary market. Living without a car means can't drop kid of to school bus stop (4km away) or get to the supermarket or train station for work. There's no buses that run through where I live. At best, this could net me a couple of thousand but even a couple of days without a car would be very hard - how would I even get to QLD to move into the new house with two kids and in-laws?
     
  2. ChrisG

    ChrisG Active Member

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    Yeah that's my thought - they likely won't know - but if they do, our income level should be high enough to not affect servicing - we're working on a every lean budget right now so might be able to reduce the size of the loan we need somewhat.
     
  3. Trainee

    Trainee Well-Known Member

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    just proves even 20k after tax a month is not enough to buy a property!
     
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  4. ChrisG

    ChrisG Active Member

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    Depends on your other expenses - we were always close but we did have enough money to buy, an extra 25k duty on top can easily blow you out of the water if you wren't prepared for it though.

    My partner was on mat leave, daughter goes to an expensive school and the cost of moving is quote high. In hind-sight, we would have saved for 3 more months and we would have been fine but we only found out about the extra duty after going unconditional.
     
  5. Trainee

    Trainee Well-Known Member

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    In hindsight you should be much, much wealthier than you are now.
     
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  6. Terry_w

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

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    Would you rather lose your deposit or suffer some inconvenience for a few days?

    My uncle just bought a car for $500 with rego of a few months remaining. I blew his engine up and we have to wait for the mechanic to come back from hols to look at it.
     
  7. opt

    opt Member

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    Exact same thing happened to me and my partner when purchasing our first home. We also realised the problem after the contract went unconditional. I’m no expert in this area, so not 100% sure about the technical details; but our solicitor was able to nominate me as the sole purchaser without altering the original contract. All we had to do was to sign some sort of a nomination form which only required our signatures. Our mortgage broker was also involved in the process, and I beleive the bank also had to aprove the change. But I’m fairly certain that we didn’t alter the original contract of sale nor required the seller’s permission for the change. We are in VIC BTW.
     
    Last edited: 3rd Jan, 2019
  8. ChrisG

    ChrisG Active Member

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    You have to get foreign investment board approval in order to list yourself as tenants in common rather than joint tenants - I'm looking into that now but the solicitor isn't keen.
     
  9. Terry_w

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

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    I don't think this is the case, it can be 50/50 Tenants in Common

    But do you even need to be on title? You could remain on the loan but settle with the spouse as owner. However if the land is in QLD this would trigger duty again, if NSW or VIC it could be done without duty.
     
  10. ChrisG

    ChrisG Active Member

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    The whole point would be to reduce my ownership down to 1% and for that it needs to be tenants in common, this isn't possible without FIRB approval from what my new solicitor is telling me? If I want to do joint tenants with my Aussie spouse then that would not need any approvals.

    FIRB approval is around 5k which is much better than 25k extra duty.

    I don't think the bank would be happy with me being on the loan but 0% on the title.
     
  11. Terry_w

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

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    No, your right the point is to reduce your ownership and hence the stamp duty surcharge.
    BUt do you have to be an owner at all?
     
  12. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    Being on the loan but not on the title happens all the time. I've yet to encounter a lender that won't do it.

    I can't comment on the FIRB approval however, that's a quagmire at the moment.
     
  13. ChrisG

    ChrisG Active Member

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    My solicitor hasn't even mentioned that as an option.

    What's the deal with the 'quagmire' with FIRB approval? I wouldn't even need approval if I'm not on the title right?

    EDIT: actually I have to be on the title - being on the loan and not the title would make me a guarantor, I am a temp resident so the bank will not allow me to be a guarantor and the bank only accepted me on the mortgage as long as I was with my Aussie partner even though it's my income that was assessed.
     
  14. Terry_w

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

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    No it wouldn't. It would make you a borrower!
     
  15. opt

    opt Member

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    This,
    My partner and I are co-borrowers on the mortgage, but only my name is on the title.

    What sort of a temp residency? Are you on early (provisional residency) stage of a spouse visa application?

    Seeing all the misinformation given by your solicitor, I'd be seeking a second opinion from someone else.
     
    Last edited: 4th Jan, 2019
  16. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    Most solicitors don't know as much about finance as they think they do, so they may not think of someone not being on title, but still being on the loan.

    When I say the, "Quagmire of FIRB", I mean that this is the legal and transfer related issue and I'm not an expert in it. This falls under the expertise of a solicitor or conveyancer. As a mortgage broker I'm moderately knowledgeable in this, but the final advice should come from the people who actually have to deal with it (solicitor or conveyancer).

    And you definitely do not have to be a guarantor to the loan if you're not on the title of a property your spouse is purchasing. You can be a co-borrower (in fact I suspect that lenders would prefer a non local resident be a borrower than a guarantor).
     
  17. ChrisG

    ChrisG Active Member

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    The paralegal (couldn't get through to the solicitor yet) said only being on the loan and not the title makes me a guarantor by default and the bank may say no to that. I have no ownership stake and can't put the house up as collateral and I would only be responsible for defaults rather than the actual mortgage.
     
  18. Terry_w

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

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    This is ridiculous and illegal advice.

    I am both a broker and a lawyer and I have done many loans where the spouse was not on title but was on the loan as a borrower, not a guarantor.
     
  19. Trainee

    Trainee Well-Known Member

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    Why does the person needing help and at risk keep fighting good options?
     
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  20. ChrisG

    ChrisG Active Member

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    I can only do what my solicitor tells me right? I'm taking all options back to him - do I need to sack him?