- Buzz LightyearParticipant@buzz-lightyearJoin Date: 2003Post Count: 43
I have recently purchased an OTP purchase through a builder I know.
Settlement not due for approximately 12 months.
In a development of five. He needed to sell one so he could get the necessary finance to build the rest. He has subsequently sold another (slightly smaller in size) for $40k above my PP.
Comparable sales for similar properties were approximately 50-60k more than my purchase price. I have had a sworn valuation on the property at $40k above my purchase price.
How do I best convince at time of settlement the bank/financial institution to lend against valuation instead of contract price.
Will again amass comparable sales inforamtion closer to settlement. Any other suggestions, tips would be most appreciated.
JamesAdministratorKeymaster@piadminJoin Date: 2013Post Count: 3,225
If some time has passed it may not be too difficult.
What I would like to know is who ordered the valuation.
There have been several situations recently (in Queensland) where the valuations were cooked to favour the vendor/developer.
PiscesBuzz LightyearParticipant@buzz-lightyearJoin Date: 2003Post Count: 43
I ordered the valuation. After seeing comps and getting agent valuations in the area, I thought it wise to confirm those with a SW. Thought if I had this, it would add to the evidence I plan to present at the time of settlement. However, the SW was not from the bank’s valuer.
JamesMortgage HunterParticipant@mortgage-hunterJoin Date: 2003Post Count: 3,781
After 12 months you shouldn’t have too many problems if you use the correct lender and sell it to them properly!
Hope the market for those properties continues to strengthen in the meantime.
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Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.scruffy1837Member@scruffy1837Join Date: 2002Post Count: 12
from my 1 experience with OTP,
if you sign the contract before 12months of completion the bank will hardly consider any market growth for the 12 month period as the bank know’s the developer figures in some of next years growth also into the cost,
I had my OTP valued by a company that is on the banks panel of valuers hoping they would accept it,no chance they took contract value.
A friend in the same developement had is contract written up,so his 80% loan was the total costing,,didn’t work the bank valued less than contract and used that,my friend lost out and lost his 30k deposit,wrecked his life.
I think it’s a sales pitch getting it valued higher than contract,,,,oh and by the way there’s lots of mortgage brokers that will tell you they can get the SW val through,,,thats another head getter they all came back to me with “contract val”.
Have fun i’m hoping to play with OTP’s more in the next leg up.
ScruffyTerrywParticipant@terrywJoin Date: 2001Post Count: 16,213
It is standard practice for the mortgage insurers and the banks to use valuation where the contract is over 12 months. If there is no LMI involved, the banks ‘may’ consider lending on val if it is nearly 12 months.
A lot of people are now finding that there has been no growth at all in the last 2 years for off the plan properties.
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[email protected]KramerMember@kramerJoin Date: 2003Post Count: 11
can be done. Commonwealth Bank have done it with nine months. Maybe the property had some special quality but they used the valuation they took themselves.
Serenity Now!melbearMember@melbearJoin Date: 2003Post Count: 2,429
I’ve heard of people getting 6 month settlements done on valuation. I guess it depends on your relationship with the bank, and how you present the deal to them.
If you can give them a whole heap of market research (accurate of course), and perhaps show them that you got a discount on purchase originally, then you might get it through.
We had some settlements that were greater than 12 months, and it was no problem (2 diff banks) getting valuation loans.