Lombard loan as SoF
- Thread starter fatcat
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There is no legal definition of at which point a SOF check ends. The laws around AML and due diligence are intentionally vague, so as to never give respite to financial institutions. As a bank, you can dig down to the depths of hell in search for how a customer came to earn a 10 dollar bill, and still be found guilty of not doing enough for AML and fined by a regulatory/supervisory government body. Banks follow a risk-based approach whereby they assess the risk you pose and apply due diligence accordingly.
For the average retail customer, a loan is by itself a satisfactory SOF︀ in most cases.
But if you are considered high risk, the bank might start digging︁ into the lender (UBO, SOF, SOW of lender) and/or digging into how you came to︂ own the collateral equities.
For the average retail customer, a loan is by itself a satisfactory SOF︀ in most cases.
But if you are considered high risk, the bank might start digging︁ into the lender (UBO, SOF, SOW of lender) and/or digging into how you came to︂ own the collateral equities.
Is lombard loan coming from a third country? If yes, in my case, i had to pay tax on bringing the amount of loan to the country to buy the property. It was not nice but still the almost 1% lombard rate was still better after taxes compared to the 4-5% mortgage.
In principle yes. But they may still ask for information on how the collateral was generated in some cases where loan amount is very high.
If they ask and you don't provide then no otherwise yes.
If they ask and you don't provide then no otherwise yes.
What sort of tax? What country are we talking?
And you'd say what's the cutoff point between︀ a "high" amount and a "very high" one? Then, as a rule of thumb, two︁ lombard loans (from different entities) is better than a single lombard loan, just because the︂ amounts are smaller?
Makes a lot of sense,︄ thanks!
And you'd say what's the cutoff point between︀ a "high" amount and a "very high" one? Then, as a rule of thumb, two︁ lombard loans (from different entities) is better than a single lombard loan, just because the︂ amounts are smaller?
Makes a lot of sense,︄ thanks!
Well, they cannot really force you to provide anything as your cooperation in all these matters are voluntarily.
But then, if you chose to not play ball, they just will not do business with you. 😉
But then, if you chose to not play ball, they just will not do business with you. 😉
So as long as you have the lombard/margin loan agreement on your hands, and it's genuine, nobody can freeze your funds - they can merely refuse to have you as a client?
I understand that offshorecorptalk is all about a more holistic, complete approach. But if the above is true, it makes the lombard loan a great first-line defense moat for the rest of the︀ setup.
I was considering Greece myself. Did you buy as a non-resident? Did they ask you for︁ any other information, pay slips, tax payments from back home, etc., or did the loan︂ agreement alone suffice?
I understand that offshorecorptalk is all about a more holistic, complete approach. But if the above is true, it makes the lombard loan a great first-line defense moat for the rest of the︀ setup.
I was considering Greece myself. Did you buy as a non-resident? Did they ask you for︁ any other information, pay slips, tax payments from back home, etc., or did the loan︂ agreement alone suffice?
They can always freeze your funds no matter what you do and as soon as︁ you bank you are at the mercy of the bank 😉 It became very clear this︂ year with a broad range of examples that this can happen by just having certain︃ nationality or by donation.
If the target bank is any good, they just reject the︄ money and it is available where you sent it from.
So, make sure your documentation︅ is good before you make a move.
If the target bank is any good, they just reject the︄ money and it is available where you sent it from.
So, make sure your documentation︅ is good before you make a move.
Don't know what cutoffs could be is as depends on many factors. Any action you can take to lower the value of the loans will help. But i.e a 1m or even 500k Lombard Loan will still make compliance officer go eek¤%& regardless of what you do.
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