Hello We own a couple of investment properties in the Sydney east. I’m trying to refinance a semi, purchased 4 years ago, has gone up in price nicely. Owe $1M. Currently interest only loan at 4.99. My broker got me a P&I loan uncond approved at 3.99. Would save me $10k per year. Happy days. But lender wants a Company Guarantee from my small business company I own. I’m the only director. No real assets on the company. What are the implications of giving a company guarantee to finance my personal investment?
I expect its because the company made a profit and that profit went to you as a shareholder. To contain the profit, the bank wants the guarantee ta rolf
If you want to get an investor in the business, or just include somebody else in your family - the guarantee could pose a problem.
Thank you guys. My concerns are Is it going to show on my company search? Is it going to limit my future borrowing capacity with another lender?
Hello from another local in the east! What are you concerned about specifically? I'm not sure how your broker has set things up but it sounds as though the bank is after assurance that the company is going to continue to earn income as your serviceability. Did you talk with your broker about it?
