Hello everyone,
Everything is in place to do a wrap. The client is currently a bankrupt whom I am comfortable to do the transaction with.
The only problem is that when speaking with an insurance broker previously he stated that either insurers are unwilling to put allow to people to co-insure a property where one of the parties is a bankrupt.
It can be done. It must be able to be done. That’s what we as wrappers do right?Does anyone have any information that will lead to the successful attainment of a co-insured insurance policy for a wrapped property with a current bankrupt?
Alternatively, you can contact me at [email protected]
Thanks for any help that you have to offer
Gratefully,
Nathan Danker
Firstly we don’t do wrap deals with Bankrupts. Ex Bankrupts certainly.
A Bankrupt is unable to enter into such a transaction and if you do you are putting your security at risk.
Secondly the property is not co-insured it is insured having being sold under an instalment terms.
I would bee looking for a new buyer.
Richard Taylor
Residential & Commercial Finance Broker
**NODOC loans from 7.14%**
Licensed Financial Planner
http://www.yourstatefinance.com
[email protected]
Ph: 07-3720 1888Richard Taylor | Australia's leading private lender
Hi Nathan
I agree with Richard. I wouldn’t be wrapping a property to an undischarged bankrupt.
“Illegal” is a strong word but a solicitor has told me that it’s illegal to supply credit to an undischarged bankrupt and on selling a property using an Instalment Sales Contract (wrap) is regarded as supplying credit.
If you really insist on selling this property to this person, you could use a lease/option (you aren’t supplying credit).
About the only reason I could see for selling a property to an undischarged bankrupt would be if your exit strategy is to set up a long term wrap. Because there’s a real good chance that it’s going to be many years before you can refinance this person into a traditional loan.
Concerning insuring wrapped property, there are only really two insurance companies who will insure properties which have been on sold using vendor finance. Assuming you are the title holder of this property, you insure the property with one of these companies and then give the wrapees details to the insurance company when the wrapees move in. The wrapees are then shown as “interested parties” on the policy, along with a declaration that the property has been on sold using vendor finance.
Good luck.
Cheers, Paul
Paul & Karen Dobson
negative2positive
Turn your negatively geared property into positive cashflow.
Phone: (02) 4984 9540Talk to us about Wrap Training Joint Ventures.
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
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