I have never heard of company titled land at all. Is this treated as Commercial Loans from home borrowing point of view? How does that different from strata or torrens? Looks like a large number of people are caught with the bank's changed stance on lending on company-titled land: 'Caught in the crossfire': Council's archaic laws hampering owners' efforts to sell homes
This is residential, but generally LVRs are restricted to 70%. St G used to go to 80% with LMI. You are essentially buying shares in a company which owns the land and the constitution of the company gives each owner the right to occupy certain units of the building on the land.
How is that different from strata title from the bank's lending point of view? I would have thought for strata titled, each title holder owns certain percentage of land .....
You don't have an interest in the land with a company title, with strata you do. You can mortgage the land. Company title will involve mortgaging the shares.
My understanding of why banks don't like it is because the company can have control over who can buy the property. This is like in America where buyers sometimes have to be approved before they can buy into certain buildings. This means if the bank exercises power of sale, it can be much more difficult to find a buyer and have them approved. This is in addition to the other issues of a company having large control which can be to the detriment of a minority owner. The other consideration is that the body corporate/owners corporation legislation will generally not apply for that building.
If the title arrangements were originally torrens when they purchased, then discovering that they had a company titled property all of a sudden would be a nasty surprise. And imagine being upset about owning a duplex in Randwick...