Immediate equity loan?

Discussion in 'Loans & Mortgage Brokers' started by Damarcus11, 8th Nov, 2019.

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  1. Damarcus11

    Damarcus11 Well-Known Member

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    I have just put in an offer for a house for 470k. I have a deposit of 280k, and the remaining 190k is the extent of my pre approved loan. The house requires some immediate renovations, probably a new kitchen and carpet to start.

    Will I be able to access the houses equity (my large deposit) in order to loan more for these renovations. I'm unsure since I am using the entire amount of the pre approved loan already.

    My salary is 60k/year.

    Thank you.
     
  2. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    The easier solution would be to increase the loan against the property to $190k + whatever you need for the renovations.

    If you can't borrow more than $190k now, then you're not going to qualify for an equity loan immediately after settlement. An income of $60k should give you more borrowing capacity than $190k, so I assume there's other things not mentioned that are restricting your borrowing capacity.

    Incidentally have you considered the purchase costs in your calculations?
     
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  3. Lindsay_W

    Lindsay_W Well-Known Member

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    As Peter mentioned, better off borrowing more for the initial purchase, keep some of the deposit money as available cash that you can put towards the renovation.
    Have you only got a pre-approval for $190K because that's all you asked for/needed or was it due to serviceability reasons?