Commercial loan serviceability

Hi Everyone,
my serviceability is very tight, I looking to borrow 65% of 1.2mil, the property is with potential development . If I go for commercial loan will it be assessed easier than normal residential loan in regards to serviceability
thanks
Hhd

 

Is it a commercial property?
What entity is purchasing?

 

it is a residential house at the moment , I will apply DA for units/boarding house and legal owner is a fixed unit trust

 

I don't know if you could settle with a commercial loan on a resident property. trust cannot be a legal owner. If the trustee is a company then the finance will be easier as the nccp act won't apply.

 

Lenders have the ability to be more flexible on commercial loans, especially if you can show them pre-sales. This may not help with the initial land purchase however.

 

thanks Terry, the trustee is the company

 

thanks Peter, this is an old house we will have DA lodged very soon

 

I assume the DA will be lodged after you purchase the property? Purchasing a property with a DA already attached frequently causes problems with bank valuations.

 

I exchanged the property with 8 months settlement which is due in 2 months, we won't have DA at settlement ,do you think I can go with commercial finance on this?

 

There are some options which may fit the initial purchase dependent on a few factors - but trying to scrape 'easy' servicing and then wanting to develop after isn't going to make this an easy deal for you. Are you sure your borrowing capacity is too tight on the residential side? I'd say half the people we see on a daily basis that say they have been told they have no more borrowing capacity, still have options.