Hi all
To cut a long story short:
My husband and I have placed an offer (which has been accepted subject to finance) on an apartment in South Perth (priced well under market rate by at least $40k) but on company title as opposed to strata title. Our plan is to purchase for capital growth and long term (at least 10 years) investment.
Us folks in Perth are not used to hearing about company titles, so now hubby and I are in panic mode….apparently only the CBA will offer a loan to purchase property on a company title.
Our financial position is (conservatively) $:
Our home (place of residence) value $950k. Mortgage $175k.
Investment property value $430k. Mortgage $350k.
My husbands income is approx $250k per year.
Our finance broker (a close friend) has said steer clear of the company title etc etc. We would like some other opinions….
We can borrows the funds using our home as guarantor, we thought we could put down a cash 20% deposit and have a stand alone loan! but apparently no banks can mortgage company title shares..
Confused as nobody in Perth is used to dealing with this and would,like some feedback :)
Cheers Callie
Hi Callie,
Sounds to me like a chat with your Solicitor (or one on here) would pay dividends. As I understand it, Company title means that the whole apartment block is owned as a single entity. Thus, to someone wanting to buy a single apartment, it is a bit like selling/buying one bedroom of someone’s house !!! ?????There are $$ to be made by buying a whole apartment block which is on Company title, then creating strata titles for each and every apartment. Once strata’ed, they can be sold off individually. Hoops to jump through, and costs, but the value of each apartment then leaps accordingly.
Hopefully, one of our resident gurus will drop by and can add more (or correct me if I have anything wrong… *eek* :p) For now though, the word I’d use would be “Caution” !!
Benny
PS I just spotted your other thread – there are some replies in there from others:-
https://www.propertyinvesting.com/topic/4991717-company-title-help-needed/-
This reply was modified 10 years, 5 months ago by
Benny.
Company title is not difficult to finance, most banks offer 80% LVR with St George going to 85%.
With that sort of equity and income you shouldnt have a problem.
But what you think is undermarket value is probably not because company title is generally worth less that strata as it is harder to finance and therefore harder to sell
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
St George go to 85% and a couple of other lenders go to 90% lvr so not that difficult to finance.
CBA would be one I would steer clear of for Company Title financing because of a couple of other issues.
Cheers
Yours in Finance
-
This reply was modified 10 years, 5 months ago by Richard Taylor.
Richard Taylor | Australia's leading private lender
-
This reply was modified 10 years, 5 months ago by
You must be logged in to reply to this topic. If you don't have an account, you can register here.
