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From: Wei Ng
Hi!
I've just heard of this concept where you can borrow heavily through many different companies, and would like to seek some advice/opinion from those who have done it.
Basically it's straightforward- borrow through a company of which you are a director, and you have to personally guarantee the loans. The amount that the company can borrow will depend on your income as a director. When company A is maxed out, you simply replicate the structure by moving to company B & repeat the process.
The theory is that since you are only acting as a guarantor to the loan, this is not recorded against your personal credit history, so when you move to company B, there is nothing in your credit history to stop you from repeating the process.
I know this sounds extremely risky, but if all the properties are cash positive from day one, and I have a huge buffer to cater for unforseen circumstances, I don't see what can go wrong.
Would love to hear your comments/criticisms. Thanx!
Cheers
Wei
Hi!
I've just heard of this concept where you can borrow heavily through many different companies, and would like to seek some advice/opinion from those who have done it.
Basically it's straightforward- borrow through a company of which you are a director, and you have to personally guarantee the loans. The amount that the company can borrow will depend on your income as a director. When company A is maxed out, you simply replicate the structure by moving to company B & repeat the process.
The theory is that since you are only acting as a guarantor to the loan, this is not recorded against your personal credit history, so when you move to company B, there is nothing in your credit history to stop you from repeating the process.
I know this sounds extremely risky, but if all the properties are cash positive from day one, and I have a huge buffer to cater for unforseen circumstances, I don't see what can go wrong.
Would love to hear your comments/criticisms. Thanx!
Cheers
Wei
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