Eternity Group

Borrowers · Entity lending

Loans for Family Trusts & Companies

Lending where the borrower is a discretionary trust, unit trust or Pty Ltd company — not the individual. Credit Representative 565110 under ACL 561324 held by Loans Only Pty Ltd. How lenders read entity borrowers, the guarantor and trust-deed checks that apply, and why the practitioner who prepares the entity returns is well placed to arrange the loan.

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Mr Rohan Manokaran (Credit Representative 565110) is authorised under Australian Credit Licence 561324 held by Loans Only Pty Ltd. Information on this page is general in nature and does not take into account your objectives, financial situation or needs. Credit eligibility, lender criteria, fees and charges apply.

In short

Can a trust or company take out a home or investment loan?

Yes. The legal borrower is the trust or company, with its directors or trustees — and the individuals who benefit — typically standing behind it as personal guarantors. The lender reviews the trust deed or company constitution, confirms there is authority to borrow and grant a mortgage, and assesses the distributions or drawings that reach the people behind the entity. Fewer lenders accept entity borrowers, so the panel is narrower and the evidence list is longer. Approval depends on the lender’s assessment, and eligibility, criteria, fees and charges apply.

When the entity is the borrower

The loan sits with the trust or the company, not with you.

Once you have chosen to hold an asset inside a family trust or a company, the lending follows that decision. The legal borrower is the entity; the people behind it stand as guarantors. That single change reshapes which lenders will fund the deal and what they need to see.

A borrower buying an investment property in their own name presents a familiar shape to almost every lender on the panel: personal income, personal liabilities, a single applicant or couple. When the borrower is instead a discretionary trust with a corporate trustee, or a Pty Ltd company, the lender is assessing a legal entity. It must read the trust deed or the company constitution, confirm who has authority to borrow and to mortgage the property, and build a guarantee structure that captures the individuals who really stand behind the loan.

The income test does not disappear, but it moves. For a trust the lender looks at the distributions flowing to the beneficiaries who are guaranteeing the loan, and at the trust’s own trading or rental income where relevant. For a company it looks at the company’s profit, the salary and dividends drawn by the directors, and the retained earnings the lender is willing to recognise. The same financial position can serve different beneficiaries or directors differently depending on how distributions and drawings have been documented over the prior two years.

Because the structure decision was usually made for tax, asset-protection or succession reasons long before the property purchase, entity lending works best when the practitioner who advised on, or who maintains, that structure is also the one arranging the finance. The deed is already understood, the distributions are already on file, and the lender shortlist can be drawn against the real structure rather than a description of it.

Entity borrower profiles

Five entity borrowing shapes.

Family (discretionary) trust

A discretionary trust, usually with a corporate trustee, holding an investment property. The lender reviews the deed for borrowing and mortgaging power, and guarantees are taken from the trustee directors and the benefiting beneficiaries. The shortlist of accepting lenders is narrower than for personal borrowing.

Pty Ltd company

A company borrowing in its own right — commonly to hold a commercial or investment property on its balance sheet. The lender reads company financials, director drawings and retained profit, and takes director and major-shareholder guarantees. Company constitution and ASIC extract are reviewed.

Further entity shapes

Unit trust

Two or more parties hold defined units in the trust, often where unrelated investors pool into a single property. Lenders look at the unit holdings, the unit-holder agreement and each unit holder as a guarantor. Documentation expands with the number of parties involved.

Trustee-company structure

A company acts as trustee for a trust, so the borrowing entity is the corporate trustee in its capacity as trustee. Both the company layer and the trust layer are reviewed: the constitution, the deed, the directors and the beneficiaries. Lender policy on this combination varies considerably.

SMSF — separate pathway

Where the property is to be held inside a self-managed super fund, fund borrowing follows a limited-recourse framework that sits outside the trust and company rules on this page. Those arrangements are covered through the dedicated SMSF pathway rather than here.

How the broker side works

From scoping to settlement.

Scoping the entity

Structure · purpose · timingWe confirm the exact borrowing entity, who its directors and beneficiaries are, what the property is for, the deposit source and the timing. This determines whether the next step is a written pre-assessment, a pre-approval or a formal application.

Deed & documents

Deed · constitution · returnsThe executed trust deed and any variations, or the company constitution and ASIC extract, plus two years of entity returns and financials, BAS, and the personal returns and identification of every director, trustee and guaranteeing beneficiary. Secure upload.

Pre-assessment

Entity-aware lender modellingBorrowing position modelled against the lenders that actually accept your trust or company structure, with the distribution or drawing history factored in. Written shortlist with policy rationale, before any credit-file enquiry.

Application

Single lender · guarantees setApplication built around the chosen lender’s entity policy, with the guarantee structure confirmed and each guarantor referred for independent legal advice. We respond to lender queries directly and report progress on a defined cadence.

Approval & settlement

Conditional · full · settlementConditional approval first, then full approval covering valuation, deed and constitution sign-off by the lender’s solicitors, guarantee execution and settlement on the contract date. Approval depends on the lender’s assessment.

Year-end consistency

Entity returns, if engagedWhere the entity’s returns are also prepared by the practice, the distributions, drawings and financials presented to the lender match what is lodged with the ATO. Next year’s application is built on figures that are already consistent.

Mr Rohan Manokaran (Credit Representative 565110) is authorised under Australian Credit Licence 561324 held by Loans Only Pty Ltd. Information on this page is general in nature and does not take into account your objectives, financial situation or needs. Credit eligibility, lender criteria, fees and charges apply.

How we are paid

How we are paid: Eternity Mortgage Solutions typically receives commissions from the lender for loans arranged on your behalf. A full explanation of how we are paid, our lender panel and any potential conflicts of interest is provided in our Credit Guide and Credit Proposal Disclosure document, available on request before any loan application is submitted.

Frequently asked questions

Trust & company loans — common questions.

Common questions

How is entity lending different from self-employed lending?

Self-employed lending is about how a lender reads your personal income when that income comes from a business you run. Entity lending is a step beyond that: here the borrower on the loan is the trust or the company itself, with the directors or beneficiaries standing behind it as guarantors. The income analysis still matters, but the lender is now also assessing the entity as the legal borrower, reviewing the trust deed or company constitution, confirming who can bind the entity, and checking that the guarantee structure is enforceable. Many self-employed people borrow in their personal names; entity borrowing is the narrower case where the asset is deliberately held by the trust or company.

Which entity borrowers do you typically work with?

Discretionary (family) trusts with a corporate trustee buying an investment property, unit trusts where two or more parties hold defined units, Pty Ltd companies borrowing in their own right, and trustee-company arrangements where a company acts as trustee for a trust. We also point self-managed super funds to the dedicated SMSF pathway, because fund borrowing follows a separate limited-recourse framework rather than the trust and company rules described here.

Who has to guarantee a trust or company loan?

In almost every case the lender requires the people behind the entity to provide personal guarantees. For a company borrower that usually means the directors and often the major shareholders. For a trust borrower it usually means the trustee (and the directors of a corporate trustee) plus the adult beneficiaries who benefit from the trust. The guarantee makes the individuals personally liable if the entity cannot repay, which is why lenders assess each guarantor for income, existing commitments and credit conduct just as they would a personal borrower. Guarantee obligations are significant and the lender will require each guarantor to obtain independent legal advice before signing.

What documents does a trust or company application need?

Expect more documentation than a personal application. For a company borrower: the company constitution or replaceable rules, ASIC company extract, two years of company tax returns and financial statements, BAS lodgements, and the personal returns and identification of every director and guarantor. For a trust borrower: the full executed trust deed and any deeds of variation, the corporate trustee's details, two years of trust returns showing distributions, and the returns and identification of the trustee directors and guaranteeing beneficiaries. The deed review matters because the lender must confirm the trustee has power to borrow and to mortgage trust property.

Why does the lender shortlist narrow for entity borrowers?

Not every lender accepts a trust or a company as the borrower, and those that do apply their own policy on which trust types, trustee structures and guarantee arrangements they will fund. Some lenders decline complex discretionary trusts outright; some require an individual trustee rather than a corporate trustee, or the reverse; some limit the number of guarantors or the entity types they will lend to. The result is that a position that would suit a wide panel in personal names suits a much smaller panel once the borrower is an entity. Identifying which lenders fit your specific deed and structure before lodging is the core of the work, and approval still depends on the lender assessment, its lending criteria and the borrower circumstances.

How are you remunerated?

How we are paid: Eternity Mortgage Solutions typically receives commissions from the lender for loans arranged on your behalf. A full explanation of how we are paid, our lender panel and any potential conflicts of interest is provided in our Credit Guide and Credit Proposal Disclosure document, available on request before any loan application is submitted.

Why does it help if my accountant also arranges the loan?

When the same practitioner prepares the entity returns and arranges the lending, the figures shown to the lender are the figures already lodged with the ATO, the trust deed and corporate structure are already understood, and the distribution history that drives serviceability is already documented. There is no second round of explaining how the structure works or reconciling differences between what the accountant lodged and what the broker presented. The entity lending follows the structure decision rather than working against it. You are free to keep your existing accountant and engage us for the lending alone; the choice is confirmed in writing before any work begins.

Related

Where this fits in the bigger picture

Entity lending follows the structure decision. These pages cover the structure advice that sits before it, the entity tax-return work that drives serviceability, and the investment lending and self-employed broker pages it connects to.