OK, long story that I’ll try and shorten as much as possible.
I have found a house on the market for 85K I negotiated price to 75K. This is a fair bit below market because the owner is 90% of the way thru a renovation but has run out of money. The property is in a small country in NSW. I am buying as PPOR
I want to borrow $60K (less than 80% LVR). The bank valuer put the value at 75K as is. No problems right? Wrong. This bank that offers “Simpler” home loans mortgage insures anything over 60% LVR (at their cost). The LMI wont approve the MI as there are four items to be completed before Council will give an Occupation Certificate on the property, about 6K worth. (We got council to confirm in writing outstanding works for occ cert)
THEY WANT ME TO DO THE WORK BEFORE I BUY THE PROPERTY. I have advised that I have set aside 20k to do reno’s ONCE I OWN THE PROPERTY. After I do the reno’s comparable sales indicate value around 120K
I have excellent credit history (but no previous home loans), earn about 120k p.a. and have cash assets of 75K+.
Why is this so hard for them? I have already had the arguments with them and the still say NO. I have decided to go to another bank. I am happy to say this has cost them 200K + as I have yanked all accounts including super.
I am seeking a simple loan that I can access over the net and can make additonal repayments and have access to redraw, with early repayment option. Can anyone suggest a product/lender or am I going to have the same problem again and again?
Any advice would be appreciated.
Thanks Heaps
You shouldn’t have a problem with this. If the lenders aren’t happy without an occ. certificate then they can do it as a construction loan. Otherwise a normal loan will do.
I would suggest BankWest Lite Invt Loan. Min loan = $60k. $500 app fee (refunded in 3rd year), rate is 6.65%, no break or ongoing fees.
Cheers
Stu
Hi Dothprotest
Although my experiences are not similar in nature, I had a huge problem with finance and found a VERY creative and awesome broker who has not only helped me with a tough situation, but has gone on to get me further financing when my outlook was almost hopeless.
If you would like his details, please e-mail me at [email protected]
best wishes
richmum
You would probably have to do it as a construction loan as there is no certificate of occupancy and most lenders are very vary of this as it can put them in a bad situation if they were to lend you the whole amount, the property settles and then you don’t do the renos and then default on your loan. It would leave them with a property that was not completed and they would have difficulty selling it. What I’ve just said is the worst possible case scenario and you have to have that in mind when dealer with the lender.
What is the postcode?
Hi People
Thankyou all for your advice.
A friend of mine has put me onto her broker and he does not think the he will have a problems sorting something out for me relatively quickly.I will keep you posted with how I go.
PS notbrokeranymore, the property is in area code 2702.
Again thanks and I hope I dont have to go around again
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