Estate Planning as a Career

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IBC or International Business Corporation is an offshore company, registered in an offshore location or in a country other than the country of origin. If youre an IBC, you can invest in property, open offshore banking accounts and enjoy several other benefits as well. In the last decade or so, laws and regulations have changed in the real estate sector for IBC. For example, earlier it was difficult to purchase property in the United Kingdom as an investment or selling the same property or renting it out to get an income. The toughest part was to get the finance to streamline this process.

The options were limited but now the situations have changed drastically. You can get a mortgage on an IBC owned property, which is in an offshore destination miles away. There are companies in U.K, who have come out with various mortgage plans aimed at IBCs, who use their offshore properties as mortgages for acquiring finances. Some of the U.K companies who have come out with these mortgage products have specifically targeted them towards servicing limited companies, which are based in offshore tax havens and jurisdictions like Guernsey, The Isle of Man, Gibraltar and Jersey. One of the offers includes an attractive 85%, three year fixed rate mortgage with a current interest rate of just 5.99%.

But then not all lenders or financial institutions offer mortgages on IBC owned property. You will have to look for the specific one. Although, there are still very few companies specializing in mortgages on offshore property or IBC owned property, with a little guidance from your consultant and the Internet, you can find the right financial institutions.

There are some advantages for people to use an offshore company or IBC structure to purchase investment property in various countries like UK or USA. This kind of an arrangement can lead to mitigation of capital gains tax and inheritance tax. The icing on the cake is that if you, as the owner of the IBC, want to gift or sell your property, which is actually in the name of IBC, then you can transfer shares within the company instead of transferring the property physically. This way, you can legally avoid stamp duty of that particular country. Coming back to mortgages, there are two ways of getting mortgages on IBC owned property.

The first one is to apply for an international mortgage from an offshore bank. The process may look confusing but here is how it works: you approach a lender in the country in which you want to purchase the property, and then you re-mortgage your existing property and use the secured capital to buy offshore. Secondly, you can approach the local lenders in the country where your IBC has been incorporated and use the IBC owned property as a mortgage. Since the IBC has been incorporated in the same country, hence getting the mortgage from a lender of that country is easier.

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This entry was posted on Friday, August 24th, 2007 at 9:38 am and is filed under , Estates, Wills, Trusts, Career Information, Blog Carnival. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.