All Topics / Finance / Borrowing in an entity and Commercial rates.

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  • Profile photo of binscabbinscab
    Participant
    @binscab
    Join Date: 2010
    Post Count: 45
    May 12, 2010 - 1:53 am

    Hi guys

    I'm about to purchase my 2nd property with a partner and want to purchase it in a 50/50 unit trust.

    I also want the loan to be in the name of the entity, this way I can borrow more in the future in the another entity (according to Steve's book)

    I've been to a few banks and have been knocked back by the personal mortgage financiers, they say they cannot lend to an entity.

    I've been directed to commercial lending, however the rates are alot higher – I was wondering, is there anyway around this? To be able to borrow at home loan rates in the name of an entity?

    Thanks in advance

    Scab

    Profile photo of binscabbinscab
    Participant
    @binscab
    Join Date: 2010
    Post Count: 45
    May 12, 2010 - 2:01 am
    binscab wrote:
    I also want the loan to be in the name of the entity, this way I can borrow more in the future in the another entity (according to Steve's book)

    Ignore that bit, I just did a search and seems like it's a myth.

    If this is the case, then would it just be much simpler to write the loan in our personal names but purchase the property in the entity?

    Profile photo of binscabbinscab
    Participant
    @binscab
    Join Date: 2010
    Post Count: 45
    May 12, 2010 - 2:06 am

    "I also want the loan to be in the name of the entity, this way I can borrow more in the future in the another entity (according to Steve's book)"

    Ignore that bit! I just did a search and seems like the consensus is that it's a myth.

    If that's the case, should I just borrow the money in our personal names and have the property in the entity?

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024
    May 12, 2010 - 5:30 am

    Bin

    Yes it is a myth but yes you can there are the odd lender left who will lend to a Unit Trust.

    Richard Taylor | Australia's leading private lender

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    May 13, 2010 - 5:41 am

    A trust is not really an entity. The trustee of the trust is the legal owner of the property and so the title goes in their name – a personal name or a company – or a combination.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

Viewing 5 posts - 1 through 5 (of 5 total)

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