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transfering a private assest to a business
goldy1981
Posts: 2 Newbie
Hi
My partner currently owns a flat which is being rented out. We would like to start a ltd company and transfer this property to the newly formed business and approach a bank for a business loan of 15k rather than re mortgage (Approx £20k profit in flat which is worth about £90k) to purchase another small flat to rent out.
Can this be done?
What costs are involved?
Do you think a bank would give me a secured business loan ?
My partner currently owns a flat which is being rented out. We would like to start a ltd company and transfer this property to the newly formed business and approach a bank for a business loan of 15k rather than re mortgage (Approx £20k profit in flat which is worth about £90k) to purchase another small flat to rent out.
Can this be done?
What costs are involved?
Do you think a bank would give me a secured business loan ?
0
Comments
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You want to start a PLC?
LOL.
You need to learn a lot more about business before you embark on anything.0 -
You appear to have a loan of £70k already secured on the flat worth £90k, so what security could you offer?No reliance should be placed on the above! Absolutely none, do you hear?0
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Wow, a PLC? I understand it costs about 100k just to set one up.0
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Just re-mortgage or get a credit card.
0 -
Find an accountant. Ask them to go through how much setting up a LTD company costs and how to transfer a property into it.0
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You are less likely to get a mortgage through a limited company than in your own name. The risk to the bank is greater as the limited company could default and you would walk away (hence the name "limited").I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0
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Cheers for all the replies some helpful others just sarcastic.
The issue i have is that it would appear that all mortgage companies now require between 25% and 30% deposit. I woulod therefore not be able to get the required money from the 20k equity in the flat already owned. Any ideas?0 -
you dont need to form a company, limited or not, to run a Buy to Let business. you can just trade under Smith & Brown properties - or whatever. you will need money to get started however.
suggest you read www.singingpig.co.uk to get a good idea as to how to finance things and the pitfalls of BTL. also www.landlordzone.co.uk is a very good site0 -
Don`t forget to check into voids, yields and everything that has to do with renting out. If I may say so, on the face of it, as a business model so far it looks flawed.0
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I'd say what the others above are saying.
Your goal is completely unachievable. You want to have a Ltd company with a BTL flat as an asset that is allegedly at an 77% LTV (mort £70k, value £90k) and borrow MORE to be able to buy another depreciating asset.
Completely out of the question.0
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