Unlimited borrowing using Family Discretionary Trust

yes potentially

 

Setting up family trust with corporate trust this Monday after these contracts are exchanged

Not a good idea

 

Why do we think so ? My solicitor in QLD advised me that I can write name as "Your name and/or nominee" and add special condition saying that the purchase with be done under family trust which isn't established yet. Will be updated once I have it, probably within next 1-2 days. When I say exchanging contract, I mean signed by me and vendor and not unconditional. Do you see any pitfalls ?

 

General question, how do other buyers willing to buy in Family Trust go about it ? I don't want to open family trust and incur 2K expense unless my offer is accepted by vendor. Hence, adopting this approach and been told this is common.

 

Silly question as against the rules but couldn't you simply write the names in the contract that you intend to set up in the corp and trust? What if they're all being done simultaneously?

 

Yes, that's what I was thinking as well and gave it to agent to fill in. Wondering worst case, it's available today but is gone when you're applying. Trying to understand how people deal with this in general. I assume people don't spend 2K upfront and look for properties. What if they don't find any which suits them and change their plan.

 

see my legal tips. Who will pay the deposit what about the stamp duty implications, asset protection etc

 

Thanks. Can I get the link please ? Sorry new to browsing this forum so don't know how to look for your posts. I remember though that I saw some tips sometime back.

 

Yes that's the thing, you're supposed to have it set up before you sign

 

My question is why and how others deal with it ? Does everyone spend couple of grand first if they intending to use family trust and look for properties later ?

 

find property negotiate and then set up once you have informal acceptance

 

search for nominee
If not find I can link tomorrow

 

Checked this - Loan Tip: And/or Nominee on contracts and Loan Approvals - PropertyChat

The only issue this highlights is about the timelines of having the trust setup for getting full approval which shouldn't be there in my case I believe. My trust setup and name should be available within a few days of signing the contract.

Accountant confirmed me that he can provide me name and abn/acn(or whatever is needed in contract) the next day of applying it. So, essentially if I sign the contract on Monday and if it gets accepted the same day, I'll immediately apply for trust setup and should hopefully have name by Tuesday/Wednesday which I can then provide to my solicitor and the agent.

Am I missing some other key aspect here ?

FYI, I am trying this for two purchases in Victoria and regional QLD.

 

Yes. Who will pay the deposit?

 

The director of the company, which is me. Also, would be added as My name and or nominee.

 

@Terry_w Can I pm you for mortgage broking needs for these transactions?

 

I don’t t accept PMs here you would need to email.

 

Can I get email id please?

 

A newbie question:
Wouldn't you have to show 2 years tax returns (1 year for some lenders) for trust income for borrowing purpose?