Construction loan and land at same time

Discussion in 'Loans & Mortgage Brokers' started by Buzzyear, 8th Oct, 2020.

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  1. Buzzyear

    Buzzyear Member

    Joined:
    14th Feb, 2020
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    Location:
    Townsville
    Hi,

    I have CBA telling me I have to own the land before I can get approval for a construction loan, I’ve got a block of land under contact at the moment but they can’t assure me I’ll be approved for construction, is This normal?
    I have sent them the building specs dimensions price , and can get a contract drawn up tomorrow, but they still say can’t approve until I own the land as they can’t Order valuations,

    help anyone ???
     
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

    Joined:
    18th Jun, 2015
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    Location:
    Australia wide
    Yes, but
    You could get a pre-approval for both
     
  3. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
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    Location:
    Gold Coast (Australia Wide)
    CBA are managing your vals risk, which is best business practice where your equity position is marginal.

    Its not that you dont own the land, its that the build cant be valued without a build contract/quote, specs and dimensioned drawings.

    Our team does lots of formal approvals for land and build before land settlement

    ta
    rolf
     

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