Hi all – could do with some (any) advice.
My son and his friend (both 18) bought a property 7 months ago and got the first home owners grant. They have lived in it for that time and now want to look at another property. The 3 of us are looking. The first will be changed to an investment loan and they have about 30% equity. I run my own business – only for 3 months, so building it. Both boys have excellent jobs and between the 3 of us we pull about $2500 a week. Banks tend to dislike anyone in business for themselves for a short time but they are both renting now and I live in the property and will be paying rent to them. Can the 3 of us buy a place and have one of the boys live in it on an investment basis or is it considered a 'home'? That is if we can overcome the problem of the bank lending to us in the first place. And then there is the problem of how to structure the purchase to protect all 3 of us – sigh.
Any advice would be appreciated.Nenal
Hi Nenal
If the 3 parties purchase the property you would not be able to rent it out to 1 of the 3 of you but in saying that the open market rent maybe higher anyway.
Initial issue is that if you are self employed and have only been runing the business for 3 months (Assuming it was a fresh start up business) you will not find any lender consider your income until you have had at least 12 months in business and can evidence your income by your Tax return (I appreciate some lenders take BAS as evidence of income but rates tend to be higher).
Secondly will you be putting in a deposit or using some of the equity in the frist house as security ? If so this brings with it a minefield of security issues as the names will be different and the Banks dont like Cross Guarantees.
If the 3 of you purchase you would probably do it as Tenants in Common and then you can split the percentages accordingly.
Sorry to be so vague but more information is required to provide a better more succinct answer.
Richard Taylor | Australia's leading private lender
Any advice would be appreciated.
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