Retaining Stamp Duty Concession + QLD FHB Grant with a Trust?

Discussion in 'The Buying & Selling Process' started by DCO90, 9th Oct, 2019.

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  1. DCO90

    DCO90 Well-Known Member

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    Hi,

    I have an small investment portfolio (all in my name) + PPOR which I bought with the FHB Grant.... obviously I’m not eligible.

    My mate, who has never bought a home, approached me to help him buy his first home or partner with him in a PPOR or perhaps an investment property.

    I’m thinking of going halves in a dual living property in the Deception Bay Area (QLD) as that is near his work.... maybe a 3+2.

    Is there a way we can partner in this, while retaining stamp duty concession + obtain the FHBG through a legal trick or loop-hole, perhaps setting up a trust?
     
  2. Trainee

    Trainee Well-Known Member

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    Forget the how. Why would you trust your money with your mate?
     
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  3. Terry_w

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

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    Yes possible by not going on title
     
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  4. Dan Wood

    Dan Wood Well-Known Member

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    Dangerous no?
     
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  5. Terry_w

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

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    Dangerous yes!

    It depends. He might be a lender and could have a mortgage which could reduce the risk a bit.
    He could also be protected by trust law.
     
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  6. DCO90

    DCO90 Well-Known Member

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    Thanks very much - I'll be in touch soon when I've looked into things more :)

    He's been a very close mate for 10+ years and I trust him 100% - it'll be mutually beneficial to go in together :)
     
  7. thatbum

    thatbum Well-Known Member

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    How exactly? With property, its rare that this is actually the case I would say.

    If you want to help him out, that's fine, but its probably best to just keep things clear and clean about that, rather than pretending its something mutually beneficial.
     
  8. Trainee

    Trainee Well-Known Member

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    Except he doesnt have the financial discipline to have his own deposit. What happens if he decides a holiday is more fun than paying the mortgage because he has a great mate who will help him out occasionally?

    Going in together means you are both responsible for the entire loan amount. Your borrowing capacities get killed for no benefit.

    Help him with information, contacts, encouragement.
     
  9. Paul@PAS

    [email protected] Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    and teach him what occurs with personal efforts and discipline. By saying no. Be his mentor and friend. Not his parachute

    People often call people lucky with financial outcomes. Its usually 0% luck and 100% effort and great personal choice
     
  10. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    If you're going to help your mate, help him my giving him a large cash deposit for his home. Do it on a handshake agreement. No legal document, no interest to pay. Just tell him you trust him to to right by you and you want to help him out.

    If you're not comfortable with this, then you definitely shouldn't be considering buying a house jointly with him in any capacity.

    BTW:
    I have done this for both friends and clients. I wouldn't do this for most people, just those I really do trust. Every one has paid the money back when they said they would.
    In every case, I offered it, I wasn't asked.
     
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  11. DCO90

    DCO90 Well-Known Member

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    This is all great advice - thanks everyone!

    I have decided to go ahead with the J.V. - I just called Terry but he was full up! Can anyone recommend a creative lawyer who might be able to help me out?
     
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  12. Paul@PAS

    [email protected] Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    QLD has some disqualifying criteria

    If the agreement is one where the legal owner holds an interest on trust for you it likely fails. As may some forms of financial assistance but these are generally related parties who arent eligible for the grant themself.
     

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