Urgent Loan Structure Advice Required

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Adelaide2012
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@adelaide2012
Join Date: 2012
Post Count: 1
June 9, 2012 - 11:38 am
Hi
A friend and myself are wanting to purchase an IP together as tenants-in-common (equal shares) but when speaking to banks they have said in relation to the loan, we will need to both be liable for the entire loan amount.
We want to avoid this if possible as it will affect our future borrowing capacity where we are each liable for the entire amount but we only own half a share each.
Has anyone been in this situation before? Any advice is greatly appreciated.
Thank you in advance
Mick C
Participant
@shape
Join Date: 2010
Post Count: 1,099
June 9, 2012 - 7:21 pm
Hi welcome!
The bank is correct in saying your liable for the entire loan amount, Ie if your friend can’t afford too pay you will have to pick up his/her slack- ie the bank can’t sell half a property.
Regarding your future borrowing, only some lenders will calculate your future lending based on the full amount; if this is an issues it’ just a matter of choosing a lender that fits – ie One that will calculate based on the % you owe.
Regards
Michael
Mick C | Shape Home Loans
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Terryw
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@terryw
Join Date: 2001
Post Count: 16,213
June 10, 2012 - 2:59 am
Make sure you each do a will and consider what will happen regarding the debt.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
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Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au