- amelie1313Participant@amelie1313Join Date: 2011Post Count: 4
My business partner and I are buying a commercial property and I have a few defaults on my name due to a businesss that went bankrupt a few years back. My business partner is putting it in her personal name only to stop the banks from looking at my history, on the back end of this we are getting a solicitor to have a legal agreement that stipulates the building belongs to both of us 50/50 – this is a long term investment and hopefully the first of many.
can anyone see any problems I/we encounter down the track?.. or is there a better solution…(yes, I have to wait another 2years before defaults are gone, then will put my name on it or put it in our business name)
would love to hear your commentsRhys AdamsParticipant@rhysadamsJoin Date: 2014Post Count: 14
Your solicitor would be able to provide the best advice but perhaps a trust structure where you are a beneficiary may work and provide you with some protection?
In what structure do you operate your business together?
You also need to be mindful of stamp duty ramifications for you to add your name on title down the track.
Where are you looking to buy?
Rhysamelie1313Participant@amelie1313Join Date: 2011Post Count: 4Corey BattParticipant@cjaysaJoin Date: 2012Post Count: 1,010
Listed beneficiaries will generally be dragged into the finance perspective in any case, so you’ll be back to square one.
A subprime lender may consider looking at this sort of deal if it can shown that the issues behind the defaults are not ongoing, but rates will significantly higher than prime lending.Rhys AdamsParticipant@rhysadamsJoin Date: 2014Post Count: 14
As long as the business and your partner can show sufficient income to show debt servicing and you have 30% equity to contribute to the purchase (plus costs) you should been in a position to finance the property.
RhysRichard TaylorParticipant@qlds007Join Date: 2003Post Count: 12,024
At a 70% lvr you should be able to obtain a competitive rate especially if you are looking at fixing the rate.
Done a couple of deals recently in the mid 5’s.
Yours in FinanceMick CParticipant@shapeJoin Date: 2010Post Count: 1,099
Discharged bankruptcy over 2 years is ok with standard banks- ie CBA, Westpac, ANZ, ING etc…at standard rates < 5% and term – just need 20% deposit + good history for the last 2 years. A minimum of 24 months clear record since being discharged from Bankruptcy or Part X Arrangement.
But if your file is still pretty bad but yes may need to consider nonbanks or a lower LVR.Mick CParticipant@shapeJoin Date: 2010Post Count: 1,099thecrestParticipant@thecrestJoin Date: 2004Post Count: 992RPIParticipant@rpiJoin Date: 2012Post Count: 308
If you are utilising a silent bare trust then that will help deal with taxation issues later on, duty needs a bit more documentation. I would strongly suggest applying for a private binding ruling from the tax office to help your SANF.
If using a unit trust you can always transfer units, again taxation and duty issues may arise (duty varies from state to state)