Home Buying in 10705>Question Details

Lisa Huff, Home Buyer in 10705

Can a S Corporation Purchase a Home?

Asked by Lisa Huff, 10705 Mon Jan 3, 2011

My partner and I have an S corporation, which we have had for almost two years. The way that we have paid our bills, through the corporation (rent for home, all home expenses, etc .), our income appears very low compared to what it could be, but obviously corp pays all of our bills. So getting approved for a mortgage is difficult. Could the corporation purchase a home?

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Short answer is yes, because I have. However, as mentioned many times, consult your attorney. Different states have different rules. Other concerns are financing and who will be occupying the property and for what what reason.
0 votes Thank Flag Link Tue Jan 4, 2011
I owned my rental property with an S-Corp. However, no lender was going to write a loan directly to the S-corp. I had to take the loan out in my name as president of the corporation. All of the business of operating the rental property came from the business account and the S-Corp filed it's taxes by March of each year as required.
That was my experience.
0 votes Thank Flag Link Mon Jan 3, 2011
I don't think you are going to get a Fannie Mae or Freddie Mac lender to loan directly to a S corp. But you can probably quite claim it to the corporation after the purchase. Check with a title company or attorney and maybe it can be done in when signing at the close of escrow.
0 votes Thank Flag Link Mon Jan 3, 2011
Hi Lisa,

I agree with the previous posts that it is always best to consult your attorney and accountant on these matters. I work with a team of attorneys and lenders who can help you if you need them. One of the lenders that I deal with with is a "Direct Lender". They loan the money directly from their office so the approval process is quicker and they can write loans that some of the big banks can't. If they can't do it than I don't think anyone can! Let me know if you would like their help or the name of of a very good real estate attorney that specializes in such things.

Happy New Year,

Walt FitzPatrick
Keller Williams Realty Group Scarsdale
0 votes Thank Flag Link Mon Jan 3, 2011
Consider consulting with your tax professional regarding any benefits of the corporation owning the home--also consult with an attorney who specializes in real estate beforehand--are you purchasing in cash....if not, generally, much will depend on the lender, and a personal guarantee may be necessary--inform yourself well beforehand--and again do consult with your tax professional and attorney for all involved legalities.....
0 votes Thank Flag Link Mon Jan 3, 2011
Consult your attorney for any and all legal advice. That being said, in my opinion the S corporation can purchase the home provided that the lender will agree to lend the money to the corporation. The lender may make you sign a personal guarantee for the note, thus eliminating part of the benefit of using the corporation.

Rey Hollingsworth Falu
Licensed Associate Real Estate Broker
Houlihan Lawrence - Bronxville

Direct 917-855-0277
Web Reference: http://AskRey.net
0 votes Thank Flag Link Mon Jan 3, 2011
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