Simple family trust question

Discussion in 'Loans & Mortgage Brokers' started by Throwaway999, 17th Jan, 2022.

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  1. Throwaway999

    Throwaway999 Member

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    The numbers Mason!
    Hi team, will keep this very short and simple as I know these type of questions pop up every few months.

    Situation:
    25 y.o. M and F (De Facto, soon to be engaged), at least 6-7 year runway before kids
    85-90k incomes full time PAYG in secure industries
    No personal debt, no credit cards
    Small HECS debts

    Have done reasonably well so far with investing - approx. 700k to put down on (hopefully) 3 investment properties over the next 18 months. Looking at getting 3 higher yielding properties (with scope to build secondary dwellings on each of them) with the goal of using this cashflow to assist us in building up a big deposit for the PPOR just prior to having kids. We would rentvest in the meantime. FWIW, we would probably look towards commercial property after the PPOR has been purchased, however this is a fair way down the track.

    Question is - can anyone see any sense in having our structure set up as a family trust w/ corporate trustee prior to going into this? Will having these CF positive properties within the trust allow us to extend our borrowing capacity in the future if we structure it correctly (with professional help of course)?
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    Risk? Are you self-employed with a likelihood of being sued?

    Properties in trusts don't get land tax thresholds in many states, so losses are trapped in the trust. Have you factored that into your +ve strategy?
     
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  3. Terry_w

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

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    Nothin simple about that question!
     
  4. Terry_w

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

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    I guess the answer is yes
     
  5. Tony Xia

    Tony Xia Structured Loan Advisor Business Member

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    CF + is always better then negative properties on the calculations, so yes in simple terms your borrowing power will be better.
     
  6. Lindsay_W

    Lindsay_W Well-Known Member

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    Best get a decent broker to run the numbers for you and map it out