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  1. #1

    Default Buying the owner occupier home under shared ownership with LTC?

    We are intending to buy (House A) , a new owner occupier home (possibly, this would be our LAST home,as we are retiring) .

    The home we currently live (House B) will be rented but will remain in the Trust.

    To enable us to buy our owner occupier new home (House A)to do so , we need to sell a property (House C) , which is a rental (under LTC) and mortgage is fixed for 2.5yrs

    All mortgages are collateral.

    In banks perspective they are happy to transfer the mortgage with House C ( swapping the security) if the settlement happends on the same day

    I have some questions for you,

    1)Can we have the new house (House A) which is going to be our residence, with Joint ownership ( new lending under Trust - Old lending under LTC) without claiming the tax portion for the swapped security (House C)

    2)In an event, that we cannot have the settlements on the same day , for new purchase (House A) and sale ( House C) can we keep all the proceedings of the sale ( of House C) until we make our purchase ( House A) and keep paying the mortgage for the old mortgage.

    3)Any other better options/ways to handle this scenario at all or any limitations by doing so?

  2. #2
    Join Date
    May 2007


    Hi Anita,

    It would be worth having a structuring/planning session with someone like me or GRA. You have multiple structures and will have a few different options available. End result would be to try to get your House A debt free and have the mortgages sitting on your rentals. But this needs careful thought and planning to do legitimately.

    My first thought, is House B a good rental? Often investors keep their old personal house because it is easy and/or emotional ties. But you need to look at it, as if you were buying a new rental, and look at items like cashflow, future repairs, gardens, potential capital gain, and determine would you effectively buy this as a rental?

    1) You would want to keep your personal house separate from the LTC, and not have the lending under the LTC.

    2) Most banks will allow you to do this, and would just keep the money in the term deposit as security for the loan

    3) As per my original comment, worth looking at whole picture and trying to restructure to your advantage. Some options could be trying to get debt free on House A, or another could be reducing the number of entities going into retirement.

    More Profit from Property? TEACH ME MORE
    Ross Barnett - Coombe Smith Property Accountants
    Proud to give the best property advice for over 13 years.


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