Hi all,
I've made an offer for a property and am currently in the process of arranging finance. The (BIG!) issue is that the property is 20% commercial and 80% resi. Every bank I've approached does not want to touch it with a 10ft pole. However, one bank is willing to lend to me @ 60% LVR. My parents will also be acting as guarantors on the property, but the bank is only allowing us to use 25% of the equity on my parents' property. So I'm left with a $350k shortfall of funds.
Now I do not know all the rules in the book, and I will be seeking proper and professional financial advice in relation to this, but I suppose it wouldn't hurt obtaining some informal advice on here.
My parents are willing to also lend my brother and I (joint purchase) $350k to meet the shortfall. Is there any way my parents and I could draft a contract stating the terms of the loan with a solicitor such that I will be required to repay them x% interest, payable monthly, over 30 years? Could my brother and I then go to our tax accountants and declare the interest paid on the IP, including the interest paid to my parents, as an expense?
In addition to my question above, would it be better for us to do away with my parents acting as guarantors and say borrow $500k instead? If so, why?
Would appreciate your advice
Thanks
I've made an offer for a property and am currently in the process of arranging finance. The (BIG!) issue is that the property is 20% commercial and 80% resi. Every bank I've approached does not want to touch it with a 10ft pole. However, one bank is willing to lend to me @ 60% LVR. My parents will also be acting as guarantors on the property, but the bank is only allowing us to use 25% of the equity on my parents' property. So I'm left with a $350k shortfall of funds.
Now I do not know all the rules in the book, and I will be seeking proper and professional financial advice in relation to this, but I suppose it wouldn't hurt obtaining some informal advice on here.
My parents are willing to also lend my brother and I (joint purchase) $350k to meet the shortfall. Is there any way my parents and I could draft a contract stating the terms of the loan with a solicitor such that I will be required to repay them x% interest, payable monthly, over 30 years? Could my brother and I then go to our tax accountants and declare the interest paid on the IP, including the interest paid to my parents, as an expense?
In addition to my question above, would it be better for us to do away with my parents acting as guarantors and say borrow $500k instead? If so, why?
Would appreciate your advice
Thanks