IN REGARDS TO LENDING/EQUITY

Viewing 6 posts - 1 through 6 (of 6 total)

dagsthedude
Member
@dagsthedude
Join Date: 2003
Post Count: 26
October 10, 2003 - 12:53 pm
say i found a house for 80k, will certain lenders fund an extra 20k for renovations?
can you lend more than the house is worth, if they know it is for investment purposes?(or if you may have purchased it below market level)
can you get around this scenario with a no-doc loan? any loopholes?
any pros and cons?
just something i was wondering……
dags nobody
the hippie investor
Terryw
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@terryw
Join Date: 2001
Post Count: 16,213
October 10, 2003 - 1:38 pm
Dags, no lender will lend more than the property is worth. In fact most will only lend 80% of what it is worth, or more-up to 95% in certain locations-if you pay lenders mortgage insurance (LMI – this covers the lender if you go bad).
With low docs, you will generally only get 80% LVR or less.
Terryw
Discover Home Loans
North Sydney
[email protected]
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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October 10, 2003 - 2:09 pm
I spoke to a mortgage broker today who advised as Steve does that most banks will loan up to 80% comfortably but once it is over this amount it gets tricky. you would possibly need to look at getting a personal loan until your improvements can be capitalised on your property . But you would be better speaking to a mortgage broker who could steer you in the right direction. I think there are some good ones who can be very helpful. hopefully this helps
kod
quote:
say i found a house for 80k, will certain lenders fund an extra 20k for renovations?
can you lend more than the house is worth, if they know it is for investment purposes?(or if you may have purchased it below market level)
can you get around this scenario with a no-doc loan? any loopholes?
any pros and cons?
just something i was wondering……
dags nobody
the hippie investor
Mortgage Hunter
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@mortgage-hunter
Join Date: 2003
Post Count: 3,781
October 10, 2003 - 9:27 pm
All true, up to 80% is relatively easy and with LMI 95% can be achieved – even 97%in some cases.
If you have additional security then more is possible – alternatively the reno money could be borrowed privately and then refinanced once the reno is complete and the valuation reflects the new value.
Cheers,
Simon Macks
Mortgage Broker
[email protected]
0425 228 985
Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
dagsthedude
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@dagsthedude
Join Date: 2003
Post Count: 26
October 11, 2003 - 6:32 am
cool thanks everyone!
dags nobody
the hippie investor
The DIY Dog Wash
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@the-diy-dog-wash
Join Date: 2003
Post Count: 696
October 11, 2003 - 6:51 am
dags
We bought a serviced apartment at the begining of the year, it was our first IP and the bank lent us 104% of the value against our PPOR. After that we realised that we should have done it differently, but it is always worth talking to your lender, however the finance people on this forum are pretty spot on.
Cheers
Leigh K[]
Carve your own path and lead the way …