Cease Director, Employee Finance

[magic]

If a person ceases to be a director of a family business company and continues as an employee, is there any waiting period before they can apply for a home loan. And is it just the usual payslips required, and he won't need to show two years individual and two years company tax returns?

 

[Terry_w]

If a person ceases to be a director of a family business company and continues as an employee, is there any waiting period before they can apply for a home loan. And is it just the usual payslips required, and he won't need to show two years individual and two years company tax returns?

Depends. Could still require financials based on the set up.

 

[Mick C]

If a person ceases to be a director of a family business company and continues as an employee, is there any waiting period before they can apply for a home loan. And is it just the usual payslips required, and he won't need to show two years individual and two years company tax returns?

If no connection at all beside employee and employer- than that's fine. Just your standard 2 payslips.

If your still a family member of one of the director of the company ...even though your not a director than the Bank's " Hired by family members policy still applies"

 

[magic]

Thanks Michael and Terry.

I know each lender would have a different policy, but what are the usual requirements for Hired by family members policy be?

 

[Terry_w]

Thanks Michael and Terry.

I know each lender would have a different policy, but what are the usual requirements for Hired by family members policy be?

2 years financials.

 

[tobe]

a letter from the accountant that does the books for the business stating start date, employment type wages etc.

 

[Terry_w]

I guess it all depends on what you mean by family. The bank knows that the figures can be easily manipulated and that is what they will be concerned with. They may not even know it is family.

 

[magic]

It's father and son. So same surname.

Would LVR be limited to 80% instead of 90%

If the company was operating at breakeven or more, is the borrowing capacity not affected. If the company made a loss of $10k p.a., when calculating borrowing capacity, would it be taking $10k off the annual salary.

With letter from accountant, is that to confirm employment wages, does it have anything to do with the company's P&L.

Thanks

 

[Terry_w]

might be ok, I did many a loan for a son empoyed by the dad's company. May vary from lender to lender.

Ask your broker.

 

[Mick C]

Possible to still get 90% - the " employed by family" policy is pretty much the same at 80 and 90% LVR....obviously 80% is easier to get approved but nothing from stopping to going for 90% that i can see.

Company profit and lost is looked upon differently and not as simple as "taking 10k off salary"....

 

[Aaron_C]

I know each lender would have a different policy, but what are the usual requirements for Hired by family members policy be?

Might be tax return or a group certificate as additional form of verification.

 

[jonmardell]

If you are just an employee then payslips would be required along with another form of verification such as a bank statement showing salary being deposited.

If a person ceases to be a director of a family business company and continues as an employee, is there any waiting period before they can apply for a home loan. And is it just the usual payslips required, and he won't need to show two years individual and two years company tax returns?