Which Bank or Loan Provider does what I want to do ?

[Pit Pony]

Got some money spare sitting in a LTD company business account.

Want to buy a residential property to rent out.

Could just about buy at the bottom end, but would prefer something a bit nicer, which might (or might not) attract a better class of tenant.

I have 42% Deposit in the Ltd Company.

I have spoken to various so called "advisers" and also to various lenders and and getting either Bullst or the brush off or both.

Even my own Business bank refuses to even look at it, because the Ltd Company wasn't set up to be a Residential Letting Company. And ? Why it matters they can not explain.

ANYWAY I appeal to the PH massive. Is there any lender out there that actually does this ?

Note I could take it out of the business, but I don't want to.

[FredClogs]

When you incorporated your ltd company you told companies house what the business does, likewise when you registered for VAT - it's a trading company not a vehicle for you to move around your personal wealth, I wouldn't treat it as such if I were you.

[surveyor]

FredClogs said:

When you incorporated your ltd company you told companies house what the business does, likewise when you registered for VAT - it's a trading company not a vehicle for you to move around your personal wealth, I wouldn't treat it as such if I were you.

So no business ever changes direction or diversifies in it's life?

[FredClogs]

surveyor said:

So no business ever changes direction or diversifies in it's life?

I think your supposed to register a company as a commercial landlord if that's the business it's in, I think they prefer it that way. Besides multiple directorships is what we all aspire to, there are good motivations for lending money from ltd company to ltd company too but you'd need an accountant to explain that to you, I'm no expert.

I'm not sure commercial property on a small scale is worth it is it? That's the impression I get.

[surveyor]

FredClogs said:

surveyor said:

So no business ever changes direction or diversifies in it's life?

I think your supposed to register a company as a commercial landlord if that's the business it's in, I think they prefer it that way. Besides multiple directorships is what we all aspire to, there are good motivations for lending money from ltd company to ltd company too but you'd need an accountant to explain that to you, I'm no expert.

I'm not sure commercial property on a small scale is worth it is it? That's the impression I get.

It depends on the property is the simple answer.

[Pit Pony]

FredClogs said:

surveyor said:

So no business ever changes direction or diversifies in it's life?

I think your supposed to register a company as a commercial landlord if that's the business it's in, I think they prefer it that way. Besides multiple directorships is what we all aspire to, there are good motivations for lending money from ltd company to ltd company too but you'd need an accountant to explain that to you, I'm no expert.

I'm not sure commercial property on a small scale is worth it is it? That's the impression I get.

So do I have to turn the current ltd company into a holding company, and have 2 divisions (both ltd companies), with different business objectives then ?
I don't particularly aspire to own a multiple of ltd companies, just because one, does consultancy and the other does property. But if that's the only way ?

[Pit Pony]

surveyor said:

FredClogs said:

When you incorporated your ltd company you told companies house what the business does, likewise when you registered for VAT - it's a trading company not a vehicle for you to move around your personal wealth, I wouldn't treat it as such if I were you.

So no business ever changes direction or diversifies in it's life?

So if I was happy for the ltd company to buy at the bottom of the market, without needing a loan (something that is now possible), would this present an issue? Surely I just tell companies house we have a secondary income steam in the annual return.

[Kudos]

Forget about the companies house bit for now, mortgage lenders do not like lending to ltd companies for residential. If they do, it's expensive with large fees. You've then got corporation tax issues ongoing, you'll also be hit for income tax if you withdraw surplus personally.

For me, I take the hit and just take the money out and buy personally.

If you register new company etc, you'll have accountant fees every year etc which will eat into any profits.

[Rangeroverover]

Try Aldemore bank....they actually look at potential deals rather than box ticking "computer says no"

[Muncher]

Kudos said:

Forget about the companies house bit for now, mortgage lenders do not like lending to ltd companies for residential. If they do, it's expensive with large fees. You've then got corporation tax issues ongoing, you'll also be hit for income tax if you withdraw surplus personally.

For me, I take the hit and just take the money out and buy personally.

If you register new company etc, you'll have accountant fees every year etc which will eat into any profits.

Not necessarily. Without going into all the details here we have put money into a Ltd company to buy property to develop as it's the most tax efficient way of doing it. The OP simply needs to speak to a decent mortgage broker.

[Pit Pony]

Muncher said:

The OP simply needs to speak to a decent mortgage broker.

Yeah. Have spoken to a few over the last few months. Decent ? as in :

One that doesn't think the easy answer would be to remortgage my own house.


That would have been too simple.

[Kudos]

Muncher said:

Not necessarily. Without going into all the details here we have put money into a Ltd company to buy property to develop as it's the most tax efficient way of doing it. The OP simply needs to speak to a decent mortgage broker.

Different scenario altogether. OP stated residential, you're talking about development

[Pit Pony]

Kudos said:

Muncher said:

Not necessarily. Without going into all the details here we have put money into a Ltd company to buy property to develop as it's the most tax efficient way of doing it. The OP simply needs to speak to a decent mortgage broker.

Different scenario altogether. OP stated residential, you're talking about development

Yeah, I'm fairly handy, but I'm not looking at "homes under the hammer" type projects.