I am considering entering into a partnership to start investing in +ve cashflow property investment. The reason for this is that it will allow the myself and my partner to begin investing sooner due to current financial constraints. I am very keen to make a start.
I would like to know if anyone has advice on the different methods of obtaining a loan for more than one person. Do i have to start a business for this to happen?
Thanks for any help.
mr
Is it possible to enter into a contract with another person that would protect each other from the other person not making re-payments?
If you are entering a partnership, then there are many ways to structure it such as Unit trusts, Discreationary trusts, company, or individual names. You should talk to an advisor on this to be sure on the best one. You may even need a partnership agreement to make sure everything is covered.
You do not need to set up any structures, but it would probably be better if you did.
Loans would depend on the structure. If using a company or trust, then the directors and/or trustees would be guarranteeing the loans. If your own names, then both partnership would be getting the loan. Eitherway, both each partner would be resposible for the whole loan. So if one stopped paying, the other would have to cover it. This eates into your serviceability.
I have purchased property in a partnership before. Once went ok, but the other time the other party decided they wanted out and I had to either sell the property or buy their share. Which was nothing major, just a hassle really
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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