Forum Replies Created
Got it
– the trust is protective and permits other flexibility
– increased borrowing power is not an innate benefit
– guarantors are always people, not matter the entity they are part of, and going guarantor reduces borrowing power the same as regular individual home loan would
The latter company scenario was not necessarily related to trusts. As Richard mentioned 'living allowance expenses', I was commenting that I'm sure there must be benefits to operating an investment company (including the potentially lower tax rate), and it would be interesting to read further on the subject.
Thanks Richard and Terry,
Was commenting in regards to increasing an individuals loan potential (as popularised in McKnight's book).
If the scenario is that you have to get new directors each time because the director is assessed in terms of all loans they have been guarantor on, then I was clarifying that there would be no advantage in creating a trust and a company as trustee if your ambition was to increase your loan potential.
I think Richard might have been angling at other benefits (or detractions) with the company. Apart from a company being capped at a 30% tax rate, I'm afraid I'm not well informed on the advantages of using a company as an investment vehicle. Is there a particular book or resource you would recommend ? I assume a company can be used to support living allowance expenses, travel, and accommodation, to certain degrees, of directors/employees if it relates to deriving a profit.
Cheers
Hi Terry – in your latter scenario, getting new directors for each company trustee would basically have the same advantages (and disadvantages) of getting someone to go guarantor for you on a loan, correct?
Just wanted to clarify if the option you outlined was simply for the theory of it, as opposed to presenting an option with advantages.
Cheers,
Peter
A few google searches didn't clear this up.. but are there special loans available for Real Estate Investment Trusts (REITs)? In order to borrow to invest, for example, in Steve's USA Commercial Property fund?
You wouldn't be able to get a simple home loan, right? Even though its secured with real estate.
Would it be in the margin loan category?
