Join Australia's most dynamic and respected property investment community

Is an independent valuation worthwhile?

Discussion in 'Property Finance' started by Weaver, 17th Aug, 2016.

  1. Weaver

    Weaver Active Member

    Joined:
    15th Aug, 2016
    Posts:
    39
    Location:
    Ballarat
    Hi, awesome forum folks - I'll been reading some very valuable advice over the last few weeks. Now to dip my toe in the water....

    I have an IP (no PPOR, cause this is provided by employer) worth I think $270k. Council rate notice says $255.
    It has an $180k loan (P&I) against it with $165k owing.

    I was hoping to borrow against this property to build IP2, and from my reading of these forums, it is better/cheaper to borrow as much as possible (80%) against IP1 (split loan), so that I can reduce my construction loan for IP2.

    I rolled over my IP1 loan to Ubank, the valuation was at $250k (18 months ago) but as I initially got a family discount when purchasing IP1 (from a parent), I think this valuation was on the low side.

    So, my question - is an independent valuation useful when applying for new funds?
    thanks W
     
  2. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,139
    Location:
    Canberra and Sydney
    Yes - an upfront valuation (or two) is useful. You'll need to get them done via the banks rather than commissioned yourself (the banks will only lend against valuations they've had conducted on their behalf).

    Cheers

    Jamie
     
  3. Weaver

    Weaver Active Member

    Joined:
    15th Aug, 2016
    Posts:
    39
    Location:
    Ballarat
    does that mean I have to apply for funds first? And does the valuation lose its independence if a bank is behind it?
     
  4. Weaver

    Weaver Active Member

    Joined:
    15th Aug, 2016
    Posts:
    39
    Location:
    Ballarat
    Extra question - can a mortgage broker help nail down a property's value? Can I pay a broker directly for their time, eg for a 'fact finding chat' when I might be 6 months away from submitting a loan application?
     
    albanga likes this.
  5. tobe

    tobe Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    879
    Location:
    Melbourne
    Get a broker to do some upfront valuations before committing to a Finance application.

    I personally don't accept funds for a fact find etc. if you don't proceed after I have done the work it's a cost of doing business. Many brokers would be similar I'd say.
     
  6. Colin Rice

    Colin Rice Mortgage Broker Australia Wide Business Member

    Joined:
    9th Jul, 2015
    Posts:
    1,078
    Location:
    Perth
    @Weaver brokers cant do vals via Ubank so a refi would be required if you where to use a valuation ordered via another lender.

    Not sure whether Ubank allow upfront vals with out an application being lodged?
     
  7. Weaver

    Weaver Active Member

    Joined:
    15th Aug, 2016
    Posts:
    39
    Location:
    Ballarat
    I was initially going to ask for a split loan from ubank based on their current val of $250k, when I get my initial loan down to $150, so asking for a $50k split for deposit on IP2. (total $200k against $250k val)

    I then found out construction interest rates are ugly......thus would like a 'solid' estimate (I know such a thing is a unicorn) so maybe an educated estimate instead :)

    would a broker be happy to assist with a construction loan application with the understanding that the loan would be rolled over to a better deal once construction is complete? I understand that there are trailing commissions for some (?all) loans that brokers secure and wouldn't want to undercut them.
     
    Colin Rice likes this.
  8. Colin Rice

    Colin Rice Mortgage Broker Australia Wide Business Member

    Joined:
    9th Jul, 2015
    Posts:
    1,078
    Location:
    Perth
    @Weaver you sound like the ideal client.

    Upfront and respectful of others time. Many are not unfortunatley.

    Hit up one of the excellent brokers on here and sure something fair and equitable can be arranged for all parties.
     
    Weaver likes this.
  9. Weaver

    Weaver Active Member

    Joined:
    15th Aug, 2016
    Posts:
    39
    Location:
    Ballarat
    This forum has been invaluable in improving my understanding of what brokers have to offer. I'm now completely on board with having someone go in to bat for me!

    Any recommendations for brokers in the Ballarat/Western Victoria region?
     
  10. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,139
    Location:
    Canberra and Sydney
    Do you need face to face contact? If not - hit up Colin who's provided some good advice.

    Cheers

    Jamie