Join Australia's most dynamic and respected property investment community

Financing Granny Flat builds?

Discussion in 'Property Finance' started by SK Investments, 21st Jul, 2015.

  1. SK Investments

    SK Investments Well-Known Member

    Joined:
    1st Jul, 2015
    Posts:
    174
    Location:
    Wherever the wind takes me, currently Brisbane
    Hi,

    I have a question for all the brokers, I'm sure this will be something many other Logan area investors will be interested in also.

    I have some IP's I'm looking at building 'auxiliary units' on within the Logan city council area.
    What are the options for finance on building these at the moment?

    One has loan currently with ANZ at 85% LVR on purchase price, possibly go back to 80% depending on current Val.

    What percentage of the build costs will I need to find in this kind of scenario, 20% of build or are there other options?

    Thank you
     
  2. Marty McDonald

    Marty McDonald Mortgage broker

    Joined:
    22nd Jun, 2015
    Posts:
    228
    Location:
    Sydney North Shore and Norther beaches
    Unfortunately ANZ is 70% max LVR for this style of thing. They call it restricted security. In terms of how much you need to put in it depends on the valuation ie combined loans not more no more than 70% of end value based on valuers opinion before the build.


    Other lenders happy to do 90% all up...was 95 ;(
     
  3. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

    Joined:
    18th Jun, 2015
    Posts:
    641
    Location:
    Sydney
    ANZ is the worst lender for dual occ construction as they only do 70% max LVR.

    They can consider 80% if the loan services without the use of the GF income.

    Its a shame because you have LMI credits up your sleeve w/ ANZ.

    Why did you go with ANZ in the first place?
     
  4. SK Investments

    SK Investments Well-Known Member

    Joined:
    1st Jul, 2015
    Posts:
    174
    Location:
    Wherever the wind takes me, currently Brisbane
    My Broker advised that Anz was a good option given my situation at the time. Probably also due to internal LMI assessment.

    I also didn't plan on being able to build another dwelling on the site.

    Any suggestions for alternate lenders?
     
  5. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

    Joined:
    18th Jun, 2015
    Posts:
    641
    Location:
    Sydney
    Any lender (except ANZ) is ok but you need to drill down and see if there is anything that you need the lender to be able to do.

    One key element may be the valuation so I dare say get your broker to narrow the most suitable list of lenders and then order a few upfront valuations with those lenders.