Title one name mortgage both

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  spal on 18/01/2016 - 07:52

  What security would B have to mortgage, see the point.

  Regarding stamp duty if the contract is signed and or nominees, and it is not an off the plan concession contract I don't think you will have stamp duty liability.

  Regarding tax deduction, in order to get a tax deduction an asset needs to be used for income producing purpose, income will have to be reported in respective tax returns, A and B both need to own or have control on the asset.

  Your best bet is to have both A and B on the title. Speak to State Revenue Office in your jurisdiction or your conveyancer. If A and B are spouses, then there may not be any duty liabilities for transferring part of the property share from A to B.

  Whatever you do, make sure you seek advice before acting, not after.

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  pjetson on 18/01/2016 - 13:27

  Yes, in at least some circumstances. I have been a co-mortgagee on a loan where only my partner was on the title. Best idea is to ask your bank, though.

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  scoobydoodledoo on 18/01/2016 - 16:23

  +2

  For tax the person in whose name the title is in (i.e., person A) will be liable to pay tax on 100% of the rental income, but may only be entitled to claim 50% of the interest expense (as they are only 50% on the mortgage). Person B will not be required to declare any income from the rent (as they have no legal interest in the property (i.e., not on title) but by the same token will not be able to claim any expenditure for their 50% share of the mortgage interest, or any other expenditure relating to the property.

  The Tax office sometimes allow person A to claim 100% of the mortgage interest, but ONLY where person A can prove that person B was a spouse and is listed on the mortgage documents purely due to bank requirements, and if not for that person A would be solely on the mortgage docs. You have to prove this to the ATO to get this outcome in an Audit.

  So not sure how you mean it is better for tax.

  I cannot commment on Stamp duty as don't have experience in those matters.

  hope this helps

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  naritas on 20/01/2016 - 14:47

  Short answer: Speaking generally, yes there are lenders that will allow parties not on title to be on the loan.
  However there are a couple of tests that most lenders will apply to the scenario:
  a) That all parties to the loan must demonstrate a tangible benefit from being on loan and
  b) The borrowing parties are married or are in a de facto relationship.

  This typically means that scenarios where this occurs is for purchase of a PPOR where the home is purchased exclusively in one partner's name and the other partner is on loan because they're living in the property as a couple. Naturally there are exceptions to this general rule, but if you're trying to evaluate a specific scenario you'd probably be best served getting credit advice from a licensed credit adviser and tax advice from a licensed tax agent/accountant.

  PS We've assumed personal names given the context of your question. The answer to your question becomes more complicated when evaluating titles/loans for trusts and corporate structures.

  Hope this helps.