Business or home loan - where to get advice?

Discussion in 'Loans & Mortgage Brokers' started by Muffins, 23rd Oct, 2021.

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  1. Muffins

    Muffins Member

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    Hi there,
    after some advice. I could purchase a property either via a business with an extension to my existing business loan or I could purchase it as a private person with a home loan. I do not have enough expertise to understand which would be the better option. Would you know who I can ask for advice?
    Thank you
     
  2. Terry_w

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

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    A business is not a legal entity or a tax entity and cannot purchase anything. A business is something an entity does. Do you mean 'company'? A company is a separate legal and tax entity and can own property.

    You should seek out a lawyer for advice on ownership structure, but first perhaps make sure either you or a company you control is able to get finance.
     
  3. Tony Xia

    Tony Xia Structured Loan Advisor Business Member

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    Is there any reason why you want to purchase it via business ( assuming you mean company structure) rather then personal?
     
  4. sanj

    sanj Well-Known Member Premium Member

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    Could there be any advantages in terms of flexibility regarding serviceability etc? I'm assuming the usual responsible lending requirements aren't valid for business loans?

    Are there any other obvious positives and negatives I've missed?

    I suppose if it's just a straight simple residential property purchase doing so in a company or company as trustee for a trust would make it more work to get a loan than a straight up personal name mortgage application
     
  5. Terry_w

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

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    They apply.

    However, where the borrower is a company the Credit Code doesn't apply.

    hardly any more work.
     
  6. Muffins

    Muffins Member

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    My apologies for not using the correct terminology. English is my third language and this terminology is a bit difficult for me.

    Its a company as a trustee for a trust. (That holds other unrelated property currently in case that matters)
    The reason I thought of buying it not as a simple residential property purchase (using the wording someone above used) is that in that case I would own it. Where as if the company buys it the trust owns it. Wouldn't that be better for an exit strategy?

    I'm pretty sure I can get the finance as it's a very good LVR

    Is this something I should discuss with the people who I used to set my structure? From memory they are not lawyers. They were accountants/business advisors
     
  7. Terry_w

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

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    Best to get ownership structure advice from a lawyer and tax advice from the accountant
     
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  8. Muffins

    Muffins Member

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    Thank you
     
    Terry_w likes this.