Join Australia's most dynamic and respected property investment community

Loan is more than the value of the property

Discussion in 'Property Finance' started by Adelaide, 19th Jul, 2016.

  1. Adelaide

    Adelaide Member

    Joined:
    1st Jul, 2015
    Posts:
    21
    Location:
    Perth
    My loan on investment house is $209,000.
    The value, once $240,000, is now $180,000 - $190,000.
    90% loan originally with LMI.

    When I sell the place for $180,000, will I need to cough up the difference or with LMI take care of that>

    Lender is CBA.

    Thanks for your thoughts.
     
  2. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

    Joined:
    18th Jun, 2015
    Posts:
    3,124
    Location:
    Perth WA
  3. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

    Joined:
    18th Jun, 2015
    Posts:
    10,362
    Location:
    Sydney
    Firstly you can sell, but you won't be able to settle without the mortgagee discharging the mortgage. They won't do this until the loan is paid out in full. So there would be no question to LMI coming to the party unless the bank took possession and then themselves sold as the mortgagee.

    LMI would then cover the bank, but LMI would come after you to the money they paid out.
     
    Dean Collins likes this.
  4. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,325
    Location:
    Canberra and Sydney
    You've have to cough up the difference - unless you can work out some sort of unsecured lending with the bank.

    Cheers

    Jamie