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  • Profile photo of mortymorty
    Member
    @morty
    Join Date: 2003
    Post Count: 25
    January 29, 2007 - 1:01 pm

    Hi Guys!
    I’m in a bit of a quandry? and i’m wondering if any of you guys could please shed some light on the matter.

    I’ve recently started a company to buy and sell property with. There are 2 directors to the company, myself and my partner. I’m self employed with 2 investment loans totalling $220,000. My partner has a PAYG income of $95,000 per annum, with one loan of 250,000.
    Our abn is brand new so alot of lenders are steering clear but wouldn’t it be possible to buy property (and secure a high LVR mortgage) through the company with myself and my partner as guarantors to the loan?

    The house we’re buying is only $220,000.

    Any advice would be gold! I’m a bit lost!

    Cheers
    Morty[weird]

    Profile photo of elkamelkam
    Member
    @elkam
    Join Date: 2006
    Post Count: 722
    January 29, 2007 - 2:21 pm

    Hello Morty

    Can I ask you why you have decided to use a company structure to buy and sell property? I assume that you’re aware that there is no CGT discount for companies.

    Of cause if your intention is to buy and sell properties as a business then the profits are seen as income and not CG so that may be OK but if it’s for investment then I always believed that a company was not the way to go.

    For investment purposes a trust is what most people recommend for both asset protection and flexibility of income/CG distribution.

    Not advise, just an opinion. [smiling]

    Elka

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024
    January 29, 2007 - 2:53 pm

    Hi Johnny

    I have sent you a reply email which i hope you have received.
    Come back to me and we can get things moving.

    Cheers

    Richard Taylor
    Residential & Commercial Finance Broker.
    Licensed Financial Planner. Ph: 07 3720 1888
    [email protected]
    Looking for life cover – We Guarantee to beat any quote you have in writing.

    Richard Taylor | Australia's leading private lender

    Profile photo of mortymorty
    Member
    @morty
    Join Date: 2003
    Post Count: 25
    January 29, 2007 - 11:57 pm

    Thanks for your reply Elka,

    As i’m a builder the properties will be traded and not held long term.
    I have a trust set up for properties that i hold.

    Cheers
    Morty

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    January 30, 2007 - 12:44 am

    Hi Morty

    I don’t think you should have a problem. As long as you and your partner could service the loan, you should be able to get the loan for a company.

    And I think having a trust is still a good idea – asset protection and will help in income distributions. But have a different trust to your buy and hold.

    Terryw
    Discover Home Loans
    [email protected]
    Send an email to get my newsletter.

    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

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