All Topics / Help Needed! / how can l tie a place for sale up, while l sort finance?

Viewing 18 posts - 1 through 18 (of 18 total)
  • Profile photo of maccmacc
    Participant
    @macc
    Join Date: 2016
    Post Count: 14

    Hey people, thanks for having me.l was in this forum yrs ago so sorta new but sorta not. Nice too, to see the place is still up and running though and also very nice to see that there is still some alternative thinking out there.

    Anyway, there’s a place up for sale that l wanna buy if I can, l’m in VIC but l need a bit of time and don’t have any cash right now to put down on it, but I’d really like to tie it up and on hold while l see if l can do the finance. It’s a good buy and l’m worried it will go.
    l know deposit bonds but l don’t like them really and although l’m cashed out right this minute, l do own 2 places outright and l’d be hope to use those against the finance.
    l also know just a little about options, not much, but l do wonder if the seller would even except one anyway,

    ls there a way l can put in an offer or contract without any money down just to tie it up while l sort my sh@t?
    The agent and l hit it off pretty good but l dunno if l’d trust her in reality none the less but thought of talking it over with her. Also have the owners name , could probably get his number but thought l might lay low on that one just for now.

    • This topic was modified 8 years ago by Profile photo of macc macc.
    • This topic was modified 8 years ago by Profile photo of macc macc.

    macc

    Vic

    Profile photo of BennyBenny
    Moderator
    @benny
    Join Date: 2002
    Post Count: 1,416

    Hi Macc,
    Depends where you are… If in Qld, perhaps a long-dated contract with $20 down and a few extra weeks than usual for finance would allow you to make it happen – if accepted by the seller.

    If in NSW, I wouldn’t know for sure, but I believe it might still be possible to get gazumped in that situation.

    Of course, options are an option :p but not commonplace, so I would think the agent would be key in getting it to work. In fact, the agent would need to be onside with the first option too – they usually fight hard for a “decent deposit” so they can be sure of picking up their commission (but that should only be 2.5%, not 10%, so $10k for a $400k house, yeah?)

    Anyway, this kind of thing is not in my day-to-day, so I will leave those few thoughts at that, and hopefully others with more knowledge will come by to add some more thoughts…..

    Benny

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    macc, firstly welcome back.

    There is no minimum deposit amount required so why would you get a line of credit set up on one of your existing unencumbered properties and then draw on this to top up the deposit if required.

    At the same time set up the finance for the new IP.

    It is fairly standard and something most Brokers do regularly.

    Cheers

    Yours in Finance

    Richard Taylor | Australia's leading private lender

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    Yes, you could put down an offer which involves a long cooling off period, subject to finance, subject to building inspection etc. This way you can pull out and get your full deposit back if you cannot meet the condition.

    Another option is to use an option agreement, but this is for more longer periods.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of maccmacc
    Participant
    @macc
    Join Date: 2016
    Post Count: 14

    Slight problem with that one Terry you missed the part where l said l have 2 properties but no cash deposit right now.
    If l had a cash deposit l’d just put in an offer and ask for 90days subject to finance , no biggie.

    l need a way to hold it for at least 60 preferably 90 days , when l don’t have the deposit right now.

    • This reply was modified 8 years ago by Profile photo of macc macc.

    macc

    Vic

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,213

    Can’t come up with $1?

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of maccmacc
    Participant
    @macc
    Join Date: 2016
    Post Count: 14

    Haha yep l can come up with 1 dollar but what exactly do l do with it ? Put it this way what seller is gonna hold a place for a dollar down on it if that’s what you mean , l’m all ears though if there’s a way .

    • This reply was modified 8 years ago by Profile photo of macc macc.

    macc

    Vic

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    Put it down as deposit.

    There is no requirement to put down 10%.

    Purchased many a Million dollar property with $1000 max.

    Cheers

    Yours in Finance

    Richard Taylor | Australia's leading private lender

    Profile photo of maccmacc
    Participant
    @macc
    Join Date: 2016
    Post Count: 14

    Yeah but l know an investor or developer would get that should he be the one selling but do everyday people selling their house ever except something like 100 or a k down ?

    Should l try talking that over with the agent ?

    • This reply was modified 8 years ago by Profile photo of macc macc.
    • This reply was modified 8 years ago by Profile photo of macc macc.
    • This reply was modified 8 years ago by Profile photo of macc macc.
    • This reply was modified 8 years ago by Profile photo of macc macc.

    macc

    Vic

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    It is very common to see $1000 put down as a deposit. $1 is not so common, but I have done deals where there is no deposit until the contract goes unconditional. So you would put down say $100 now with the remaider making up 10% when the conditions are met – subject to finance etc. And it doesn’t have to be 10%. COme to think of it I have seen the 10% paid at settlement.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of maccmacc
    Participant
    @macc
    Join Date: 2016
    Post Count: 14

    Hmm , thanks for that Terry, l’m going to go with that and see what l can do next wk with it l think.
    lt’s just a case of timing right now as what cash there is has just been put back into work and is tied up there for a few mths but with my other places , it shouldn’t really matter l guess but l would like to get this place just tied up a bit first though before l went to too much other trouble.
    lt’s a lot of work and time getting finance up here, regional Vic and l’ve learned only too well in the past , save myself a whole lot of grief and don’t even bother unless you have a few of the main eggs lined up first and can be pretty sure you’ll be able to get it.

    Anyway then , l’ll see what l can do with that then and take it from there. Cheers

    macc

    Vic

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    Macc getting finance lined up in Regional Victoria would be the same as if you lived in Helsinki or centre of Sydney as most applications are lodged online and merely a matter of gathering up certain documents.

    Hate to say in 2016 lenders require a reasonable amount of documentation however a good investment orientated mortgage broker should be able to guide you thru the process.

    Your location wouldn’t mean more work for either party.

    Cheers

    Yours in Finance

    Richard Taylor | Australia's leading private lender

    Profile photo of maccmacc
    Participant
    @macc
    Join Date: 2016
    Post Count: 14

    Wish that were all Richard , l’ve heard it a lot but the trouble is yeah when you put in the app that’s how it is but not when they see the post code and town sizes , that’s the thing.

    lt took 6mths to finance my last place.

    macc

    Vic

    Profile photo of Jamie MooreJamie Moore
    Participant
    @jamie-m
    Join Date: 2010
    Post Count: 5,069

    Hiya

    Talk to the agent and negotiate a small deposit with an extended finance clause period.

    It won’t be an attractive offer (because they will need to wait a while for you to sort out finances) but if the property has been on the market for a while you might have some luck.

    Get a decent broker on board to get this sorted asap too – Richard or Terry above will do a good job.

    Cheers

    Jamie

    Jamie Moore | Pass Go Home Loans Pty Ltd
    http://www.passgo.com.au
    Email Me | Phone Me

    Mortgage Broker assisting clients Australia wide Email: [email protected]

    Profile photo of DeanCollinsDeanCollins
    Participant
    @deancollins
    Join Date: 2015
    Post Count: 376

    As far as the ATO is concerned the date of purchase then becomes the first date of the deposit right? eg they don’t consider the date of the 10% deposit to be the purchase date (eg if you make an small holding deposit pending finance approval)

    Wondering how this is seen by the ATO if you have a long pending approval period

    Profile photo of BennyBenny
    Moderator
    @benny
    Join Date: 2002
    Post Count: 1,416

    Hi Dean,

    As far as the ATO is concerned the date of purchase then becomes the first date of the deposit right?

    As far as I know, the Contract Date is the date that is used by the ATO. This has likely “caught” many people in the past (e.g. the seller wanting to sell a property in a new FY for CGT purposes – they are expecting a lower income in the new FY). So they put it on the market and have an offer on contract signed in June to settle in August.

    ATO uses the June date (contract date) for CGT purposes, and the seller then has the relevant profit added onto his higher salary from the past FY, instead of onto the lower expected income of the new FY. His debt to the ATO has also moved forward by several months (eeekk!!). Check it out to be sure …..

    Benny

    Profile photo of DeanCollinsDeanCollins
    Participant
    @deancollins
    Join Date: 2015
    Post Count: 376

    Thanks for confirming Benny.

    Is there any way to “delay” a “contract date” eg if you did want to “delay” a sale into the July financial year can you sign “an option to purchase” in the current financial year which is then “executed” with a contract signing once the 1st of July rolls around? obviously this would then be followed by a settlement 42 days later eg the 2nd week of August?

    Profile photo of maccmacc
    Participant
    @macc
    Join Date: 2016
    Post Count: 14

    cancel .

    • This reply was modified 8 years ago by Profile photo of macc macc.

    macc

    Vic

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