As a worker, would an ABN for part-time startup affects borrowing?

Discussion in 'Loans & Mortgage Brokers' started by chunho01, 25th Jan, 2020.

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  1. chunho01

    chunho01 Well-Known Member

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    I work full-time for a company, but I have a recently registered sole trader ABN for my part-time startup.

    I haven't gone through a tax refund yet that has the sole trader activities, but as of now, there's minimal money flowing in/out due to the startup still in internal development. Mostly just my personal time commitment.

    My question is, if I go for a new mortgage now, is having an ABN going to affect the process? Will banks ask more questions or require more documents? Is my borrowing capacity affected? Ie. if banks are worried that there is a possibility that I will inject money into the startup.
     
  2. sumterrence

    sumterrence Well-Known Member

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    It will ask for more details but it won't affact your borrowing unless there is a constant cash flow required from your day job. If you only register for ABN and not a company I don't think it will even show up on your credit file.
     
  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    I agree. Should have no effect unless making money but will need 2 years history. If making a loss and lender sees that it will reduce borrowing cap
     
  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    As a worst case may require a letter from the accountant to state the business is trading ok and has no liabilities

    ta
    rolf
     
  5. Mike A

    Mike A Well-Known Member

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    Accountants are being advised not to make a statement about trading ok. Saying that it is trading is fine.

    What if the last financials showed a profit and the 6 months to date it wasnt trading ok

    Exposure to unnecessary liability.

    My experience has been you change the wording slightly and it gets accepted by the lender anyway