Being in business means accepting some level of risk right? Well that may be true, but there is no need for the long arm of your creditors to extend to the roof over your head!
You have worked long and hard to pay off your home, and whilst this is a good thing, it was that very mortgage you hated that was protecting your asset from those who would aim to take from you.
So where to now?
Woman of substance man of straw (or vice versa) anyone? With this tried and tested strategy the at risk partner sells or transfers their interest to the other safer partner. But who wants to pay all that stamp duty or potentially CGT and be dispossessed of their property right? And what if your single?
How about just selling the place and starting again in “safety mode”? But you love your home right….all those memories and still that pesky CGT to potentially worry about.
Eureka! How about we just transfer it to a trust I hear you say. Yet again stamp duty and CGT get in the way.
So what if I told you that you need not do any of the above to put up a rock solid barrier between your home and the big bad world and that you need not pay transfer stamp duty or CGT? Well it works something like this…
Step 1 Setup at CAAA Family Home Trust
Step 2 Go to the bank and borrow 80% of the value of your home (don’t worry its short term)
Step 3 Gift these funds to your CAAA Family Home Trust with formal documents drafted by our lawyers
Step 4 Your CAAA Family Home Trust then lends you back the money (at generous terms I might add)
Step 5 As security your CAAA Family Home Trust takes a mortgage over the house
Step 6 You then take the cash and pay back the bank (I told you it was short term)
The final result….your house is now protected by a mortgage again, and other than some banking
and legal costs, at very little expense.
Now like anything the devil is in the detail, so if think you need this type of protection, make sure it’s done right.
This area of law is complex so please seek independent specific advice from a qualified professional, as the above does not consider your personal circumstance, in particular the timing of gifts and the protection they may subsequently offer you is a key matter to be managed.
CAAA is a nationally recognised and internationally affiliated Top 100 professional services firm specializing in private client services and asset protection.
Please call us for a consultation today +61 2 9299 1200