Lenders tighten rules for trust and company loans

Clients who invest through trusts or companies - structures that are often used to protect assets from personal risk, plan how generational wealth is distributed, and manage tax-effective income strategies - may notice some recent changes in how lenders assess trust and company loan applications. 

Over the past few months, several major lenders have tightened how they assess - and in some cases, whether they will even accept - new loan applications where the borrower is a trust or company. This doesn’t mean company/trust lending is off the table; rather, it highlights the increased importance of selecting the right lender and presenting a well-structured application. 

The reasoning across lenders is fairly consistent: they are applying more conservative risk settings with greater scrutiny on loan structures, servicing responsibility and income verification within trusts and companies. 

What’s changed in the lending landscape 

Here are a few of the headline shifts we’re seeing: 

What this means for clients 

Clients purchasing or refinancing through a trust or company should now expect: 

That said, there are still lenders, including specialist and non-bank options, that will consider these structures on a case-by-case basis. In many scenarios, the outcome comes down to matching the deal to the right policy and presenting a polished application. 

The takeaway 

If you’re planning to finance, refinance, or restructure a loan held within a trust or company, it’s worth having a strategy discussion before signing contracts or making structural changes.  

A short strategy discussion can clarify: