advice needed ,i have a ppor on a block of land i also own the block of land beside me ,these are on seperate titles but i have amalgamated both for rates reduction ,i also have 2 investment properties one i owe $142,000 (rental is $270 per week) and is valued at $265,000 the other i owe $192,000 (rental is $260 per week)and is valued at $310,000. i owe $280,000 on the ppor(both lots together)with a market value of $360,000 .the vacant block of land standing alone would be worth about $120,000 by itself ,now i want to sell my existing home on a single block of land to build a smaller home on the vacant block ,by selling the ppor i will be able to clear the debt ($280,000) leaving the vacant block of land debt free ,i own a small business that i have run for 29 years now and with all small businesses taxable figures arnt the best (if you know what i mean) last year with the gfc i ran my first loss for 20 years ,can any one see a way to get finance to build the new house while i am selling the existing home .i want to do it this way so that i dont have to move into one of the investment homes while i am building and loose the rental income
dont mean to nag but there must be someone here with an option i can take for this
Hi Tom
Think we have been this route before.
There is only 2 standard lenders left i am aware of who will do lodoc construction in the current climate and the interest rates are not attractive.
Refinancing a lodoc deal is also an issue in its own rights.
Both loans would need to be done on a declared income basis.
Richard Taylor | Australia's leading private lender
Qlds007 wrote:Hi TomThink we have been this route before.
There is only 2 standard lenders left i am aware of who will do lodoc construction in the current climate and the interest rates are not attractive.
Refinancing a lodoc deal is also an issue in its own rights.
Both loans would need to be done on a declared income basis.
i am not asking to refinance an existing loan .i am seeking financial options to build a new home while selling the existing ppor
As i said there i am only aware of 2 standard lenders who will do lodoc construction irrespective of whether it be a refi or a bridging loan.
Richard Taylor | Australia's leading private lender
How do you build a new house without a construction loan?
do you have enough CASH?arms wrote:advice needed ,i have a ppor on a block of land i also own the block of land beside me ,these are on seperate titles but i have amalgamated both for rates reduction ,i also have 2 investment properties one i owe $142,000 (rental is $270 per week) and is valued at $265,000 the other i owe $192,000 (rental is $260 per week)and is valued at $310,000. i owe $280,000 on the ppor(both lots together)with a market value of $360,000 .the vacant block of land standing alone would be worth about $120,000 by itself ,now i want to sell my existing home on a single block of land to build a smaller home on the vacant block ,by selling the ppor i will be able to clear the debt ($280,000) leaving the vacant block of land debt free ,i own a small business that i have run for 29 years now and with all small businesses taxable figures arnt the best (if you know what i mean) last year with the gfc i ran my first loss for 20 years ,can any one see a way to get finance to build the new house while i am selling the existing home .i want to do it this way so that i dont have to move into one of the investment homes while i am building and loose the rental incomeTom, perhaps you could consider selling the first IP thus freeing up $120,000 or so? This should be enough to have the new building "substantially complete" and if timed well the proceeds from your PPOR (once you have moved into the substantially complete dwelling) will complete the construction. Then have a look at what you've got left and reload your investment portfolio.
sounds like you are going to have to sell one of the houses, id say the one you owe the most on, build your house get your debt free block of land and re work your money in to a new inv property when all is done. Might sound feel like you are selling a house you prob got a good deal on but if you can put that money to better use there is no reason not to sell.
The other option could be private investers or some sort of silent partner to fund some or all of the funds needed to build. You have about 120k in equity so im sure some one out there would be interested!?
Hi Tom.
Just a thought, but could you sell the home, then rent as cheaply as possible for the time it takes to build on the block? As your block would be debt free, and you have equity and cash flow in your other investments, I think you might be able to borrow against it despite your less favorable business figures?
G
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