Lender recommendation for borrowing for 42sqm 1 bedroom apartment

Hi,

Just seeing if anyone knows a lender who lends for smaller property. I found investment property of 1 bedroom (no parking) with 42 square meter living area (no balcany).


My current lender has minimum requirement of 49 square meters. We can do 70% or 60% LVR if that means we get a good interest rate deal.

Any recommendations?

 

CBA usually are a good bet for smaller units. Will accept at 80, few others too at lower LVRs (rate won't move that much further down though).

 

Plenty of lenders finance properties above 40sqm - its when the property is under 40sqm that the lender pool reduces significantly and where lenders like CBA and NAB excel.

You just need to ensure the property isn't on the lender's security register (if they have one) or postcode restriction list.

 

If the total area is above 50M2 - that means living area + balcony , parking , storage etc... NAB will go to 90%

You have no balcony, but if you so have parking they might be an option.

Otherwise..CBA is likely to be your huckleberry

 

Thanks. Yeah i did check and it is not under lender's security register.

Well, who would have the best rate. CBA are good but they are usually premium compared to other banks. Also need an offset account since it is investment property.

 

Often its about what the lender is prepared to lend you rather than what rate you are able to get.

40sqm still gives you plenty of options - no point in recommending a specific lender without knowing your overall circumstances. Resimac as an example will do 4.02% for IO or 3.82% for P&I. Is Resimac the best lender though? Probably / probably not. The security register is different for each lender (that has one) and is not a general list.

I would also question whether its better to inject more capital in a project/asset for the sake of an extra few basis points.

 

Yeah fair enough.

Fair enough. Makes sense. I have fairly standard requirements. Only exception is that property is 42square meter in size. So, want offset account as it will be investment property.
Rest is ideally have lowest rate possible. Currently i pay around 3.69% for owner occupied (they don't lend to 42square meter).
CBA i had a look said on their website as even of 5%. Preference is to invest more capital (70 or lower basis point) for lower rate.

 

You can get 3.57% for P&I on the owner occ with Resimac so I wouldn't say 3.69% is the cheapest. No one is suggesting you use CBA or Resimac for that matter - there is a number of lenders that will do 40sqm plus units at 80%.

It just comes down to who will do it, do their features (of say having an offset) fit your requirements and how is going to offer you the best rate from that list.

 

Last time I checked, St George and ING are also doing this, just inquire directly from them.

 

Dont be stupid. Find a bigger place.

 

42sqm no parking no balcony. Hard to finance, hard to refinance, hard to sell. Why do that to yourself?

 

I think for Sydney, that sort of property isn't the worst possible, you can get far smaller than that! On the plus side, it's over 40sqm. I would want a balcony though. Note that studios in Sydney are often around the 400k mark. You don't get much for under 400k in Sydney. 1 bedrooms near the city sized over 50sqm are not less than 600k or so. A big jump in dollar amounts.

 

Small living area = CBA deal

Cheers

Jamie

 

Thanks everyone. I ended up getting it through my current lender Macquarie Bank. They lent it on 60% LVR. I know you should maximize LVR, etc. However, for my personal situation that works really well.

 

Is it inner north suburbs of perth by chance?

 

Thanks

 

Nope. Its in eastern suburbs of sydney

 

they can be cash cows especially in Sydney

#location #location #location

 

My pool is almost tyhat size. I should have checked lvr for a pool