Getting finance for a spec through a company

Discussion in 'Loans & Mortgage Brokers' started by jippa3000, 23rd Apr, 2017.

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  1. jippa3000

    jippa3000 Member

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    5th Jul, 2015
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    Melbourne
    Hi All,

    Just wondering if anyone has had experience on the following.

    Run a company at the moment which makes a profit. As this is a consulting business and don't want it to have any assets as such, I want to start a new company to purchase land and build specs in.

    So my main question would be has any done the above and how did you go about getting finance. Did the bank require a business plan or proof of doing it previously.

    Any assistance would be greatly appreciated.

    Thanks
     
    jippa3000, 23rd Apr, 2017
    #1
  2. D.T.

    D.T. Specialist Property Manager Business Member

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    I don't see how this is any different to what the rest of us are doing. Which part did you think would be tricky?
     
    D.T., 23rd Apr, 2017
    #2
    Terry_w likes this.
  3. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Location:
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    the new HOLDING company will require a directors guarantee from you, and possibly your operating company if that entity has a bunch of retained earnings

    the new company has no income aside from rent.........

    As an aside, get specific structuring advice as most times a company on its own isnt great vehicle to buy IPs in

    ta
    rolf
     
    Rolf Latham, 23rd Apr, 2017
    #3
  4. Simon Moore

    Simon Moore Residential & Commercial Mortgage Broker Business Member

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    Level 2 287 Collins St Melbourne VIC 3000
    Borrowing in a company name is reasonably straightforward but it will reduce the number of lenders who will look at the deal.

    As @Rolf Latham said you will be up for personal guarantees for the directors. It does get more complicated if you have multiple unrelated directors.

    Have you received any advice about how best to structure your investments?
     
    Simon Moore, 23rd Apr, 2017
    #4
  5. jippa3000

    jippa3000 Member

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    Melbourne
    @Rolf Latham and @Simon Moore thanks for the feedback.

    This company is purely to turn properties over, so will not be holding.

    I have received advice from my accountant in terms of structure but not on the lending side, hence my reason for the question as I was unsure on how the new company would get a loan.

    Thank again to both of you, I'll let you know how I go.
     
    jippa3000, 25th Apr, 2017
    #5