Banks generally like you to be employed for at least 6 months. For 95% loans you will have to show genuine savings of at least 3% of the purchase price (if you can get FHOG). There are 100% loans available for owner occupiers, conditions are tougher and include being in same job for at least 12 months.

There are various products available including asset lends where the lender goes purely on the value of the property (up to 85% lvr). No income required. There are also low doc loans at 80% lvr where you just declare your income with no proof (or checking) required. (people have been know to exagerate their incomes!).

If you can keep comming up with 20% deposits, then you can keep getting loans.

Terryw
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Windel and Stu

Let me guess, they wanted to take a charge over the company as well as personal guarrantees? Or was it a Hybrid trust?

Terryw
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I personally will never fix again. It makes you trapped to the bank. very hard to sell or to refinance without paying penalties. I know people who had had to m=pay more than $20,000 in penalties from breaking a fixed loan (house sold due to divorce settlment).

Terryw
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Brizza, No you can’t. Just add up the total value of the property and the total value of loans and multiply by 90%.

You may be able to go to 95% though.

Terryw
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Comdom

You can’t just transfer you properties to a trust. They will have to be sold to the trust, this means CGT and stamp duty implications. Do some figures, it may not be worth it.

Really you should be talking to an accountant about this. You would probably need a Discretionary trust or a Hybrid discretionary Trust.

Terryw
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I am in Sydney, but the agent is in Victoria. feel free to email me.

Terryw
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I know he had Dave working in the accounting firm making money for deposits. He also probably did many wraps, and would have got the FHOG as deposit at least. If he did 10 wraps then $70,000 would have come in (maybe more?)

Terryw
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Getting a loan for a trust is easy. What went wrong? Most banks will do them, some low doc lenders won’t (eg ING and Suncorp), but if you have individual trustees, you loans could be in the individual names instead of the trust. You must have a corporate trustee.

Most importantly, I hope all of these applications don’t go on your CRAA! Did you actually submit loans applications?

Terryw
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Hi JayJay

Yes banks will lend to a new company with no history set up just for property investment. In fact most banks will only lend to non trading companies (ie setup purely for investments) because of the risk involved.

But I agree with Windel, you shouldn’t buy property in a company. Use a trust instead-with a corporate trustee.

If you are both directors or trustees, then you will have to guarrantee the loan. It is really just the same proceedure as getting a loan in your own name. You will ahve to prove your own personal incomes etc and provide a copy of the trust deed.

Terryw
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Hi Captain

i know of a real estate agent that does wraps and lease options. He finds the properties, tenants and does all management. all cashflow properties.

Email me and I can give you his details.

Terryw
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