Prime Alt Doc Loan via Family Trust

SUCCESS FACTORS

  • Having a strong BDM whom we have known and worked closely with for several years and we can run scenario testing with under time pressure
  • The strong support from the client’s accountant allowed us to verify the income flowing into the business, as well as evidence a recent transition from a partnership to a trust structure.

THE SITUATION

The clients owned and operated a wholesale distribution business based in Sydney. 

When they reached out to us, they were interested in a property selling at an auction in 10 days and wanted to secure a pre-approval before auction.

This property, if they successfully bid for it, would be their family home. They would then keep the current home as an investment property.

THE CHALLENGE

  • The business was growing and making sufficient income, however the financial statements and other supporting documents were not ready for a full-doc application
  • Clients were operating their business in two entities transitioning from a partnership to a family trust in a new company registered for less than 12 months
  • The business was mostly trading in cash and the clients were depositing their incomes into both business and personal accounts
  • For many lenders, the SLAs were high for a pre-approval and unable to meet the auction date
  • Therefore, we had to find lenders that provide low-doc / alt-doc loans and that can deliver pre-approval before the auction date which was 10 days away. 

THE RESULTS

After finding a suitable lender i.e. Bluestone, we immediately did scenario testing with the BDM.

We confirmed the clients’ income level with the accountant. We also performed a detailed review to mark all credits in the bank accounts in order to derive the income required.

The clients also had to cancel their existing liabilities (car loans) to maximise their borrowing capacity.

During this tight time frame, we also secured an accountant’s letter to support the business transition to a new company structure.

The final outcome was an alt doc pre-approval of $1.36M (80% LVR) for purchasing a new home valued up to $1.7M. The clients were able to bid confidently at auction.

WHO TO TALK TO

Tommy Lim
Managing Director
Contact Us

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