All Topics / Finance / Deposit Finance/Carry Back for a unit block, in a compant/trust structure.

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  • Profile photo of DanielBDanielB
    Participant
    @danielb
    Join Date: 2009
    Post Count: 33
    March 31, 2014 - 1:03 am

    Hi all,

    I am looking to purchase unit blocks in Tasmania, using carry back finance for the deposit amount.  However I am under the impression banks no longer loan the balance amount when the deposit has been financed by the vendor?  I have a company trust structure setup at the moment for completing my property deals.  The units I'm looking at are positive cash flow and in the inner suburbs.

    Can anyone offer me any advice or provide details of any brokers who could get these types of deals across the line?

    The other option is for me to option some properties, renovate and on sell to get the deposit funds.

    Many thanks,

    Daniel.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    March 31, 2014 - 11:31 am

    There may be some private type lenders who will allow this.

    Generally there are 2 problems

    1. Second mortgage

    2. lender nothing you have no money in the game.

    Solution may be to use own funds initially and then borrow from the vendor at or after settlement.

    Sounds like you may have recently done a course – be careful. This is good in theory but rarely works out.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024
    March 31, 2014 - 12:12 pm

    Agree with Terry easier said than done.

    Usually the Vendor offers such an arrangement where he cannot sell the property for market price and does it to attract a higher price.

    Away from the issue in getting any lender to accept the second mortgage carry back the other issue might be getting the property to value at purchase price.

    Flipping or executing a Call Option might be a way to get your training wheels.

    Cheers

    Yours in Finance

    Richard Taylor | Australia's leading private lender

    Profile photo of DanielBDanielB
    Participant
    @danielb
    Join Date: 2009
    Post Count: 33
    March 31, 2014 - 10:18 pm

    Thanks for the replies guys.  

    Based on the research I had done, I am not at all surprised at your answers.  I guess I was just hoping the banks might have changed the rules a bit as the markets had picked up. :)

    If it seems to good to be true, it probably is.

    Cheers,

    Daniel.

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024
    April 1, 2014 - 11:30 am

    Hi Daniel

    Have to say as the market has picked up lenders have gone the other way and doing anything out of the ordinary as they don't need to.

    Cheers

    Yours in Finance

    Richard Taylor | Australia's leading private lender

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