80% LVR on commercial finance

Oh wow - that's news to me. Do you know if it applies to Melbourne based suburbs?

 

Pm Marty with the address and he can put it in the ANZ val system and see.

 

Done!

 

ANZ is not going to go off COS for $2mil purchases - they only do a max $1mil.

The only lender that is going to do COS for $1.5mil is Teachers Mutual Bank.

They will do COS for LVR's of 80% but the location of the property must be metro.

 

Thanks a mill Shahin,

Marty did confirm that ANZ will do COS....but it's only for a handful of suburbs in Melbourne unfortunately. Basically a few blue chip locations with large family homes (e.g. Toorak, Brighton, Balwyn, etc).

Teachers Mutual Bank looks very interesting.
If they could do COS at 1.5mil... it would save me a lot of drama.

My only concern would be that the presence of permits in the COS would trigger a full valuation?

 

The lender will only look at the front page of the COS so its a moot point.

 

Surely they look at the Special Conditions as well? What happens when there is a 250k rebate attached?

 

I was thinking of a NSW COS whereas this is a VIC purchase which requires the full COS. Having said that the plans shouldn't be part of the COS. Nevertheless the lender will still take the COS even with the plans.

 

Not 100% correct mate. Attached is the list of a blue chip postcodes that they will do a modelled estimate on up to $2 mil

 

Nice policy update with the Granny properties now being considered as Standard Residential.

 

I think the model vals for those suburbs are only available for refinances in those suburbs.

I believe Shahin is right, $1m purchases automatically revert to full valuations which has been the policy in the past. I recall I had a case a client purchased a holiday home LVR was less than 25% but the bank still wanted a full val as the purchase was over $1m.

 

Seems odd that would not do an arms length purchase using a modelled estimate but would do for a refi.

I have tried three dummy orders in Lindfield postcode 2070 which is on the list. All real house addresses with estimated or contract prices at $1,950,000 and 10% LVR. After processing ANZ valuations have all come up as full vals so now I am completely confussed!

 

I think it is because model vals are only available for customer estimate (ie internal or external refinances).

Purchases always ask for contract price and not customer estimate and as per your trials, it appears that those postcodes are not exempt to ANZ's policy where they always request for a full val regardless of the LVR if the property was purchased for over 1m.

 

ANZ's valuation policies can be quite frustrating at times. Their system is also painful in that it's results don't always fit their policy. ie the valuation system can reference utilising a previous modelled estimate, but if this was not used when previously generated it's invalid and will require a kerbside/full val.

 

I ran as a refinance with customer estimates for 2 different addresses in that postcode, both properties I know personally and are worth about $2.8 and $4.5 mil. Maybe that's the issue...it gets kicked out to a full val if the engine behind the scenes estimates it too far statistically from $2 mil? It is pretty dumb though as the suburbs included on that list mostly have houses in the well over $2 mil price point so when could this new policy be used? You cant buy a house in Bellevue Hill for less than 4 or 5 not that I get many of those deals .

 

Thats for modelled estimates which is only for refi's and equity releases. It doesn't apply to purchases. They go full valuation on the purchases.

Westpac and TMB are the only ones at that threshold that will do COS.

 

Need a 300k loan and your property is worth 3m, they still will require a full val and most likely a long form val which costs the bank around $1.5k+ which is very dumb indeed.

 

What are the current interest rates looking like for commercial properties (standard shop fronts)? I have tried googling it with little luck.. Seems to bring up business loans...

 

In the 4-5.x% range generally - dependent on terms, LVR, location, loan type etc. The margin between residential and commercial loans has tightened sharply over the last few years making the commercial space a lot more attractive option for investors.