No idea what I'm doing.

Long story short. We sold our ppor a week ago. 75 days settlement around about 25th November.
Current lender Bank of melb. We are worried whether the buyer is able to settle. Meanwhile we want to start looking at new ppor. Our idea is get a bridging loan preapproval so if we see a ppor we like, we will bid for it before the old ppor settles. If the buyer of our old ppor can't settle, at least we can try to sell our old ppor again. So bank of melb only allows bridging loan 6 months, commbank allows 12 months. So the idea is refinance to commbank, just in case the buyer of our old ppor can't settle, we have 12 months to sell old ppor again.
Here's where I am getting really confused. My conveyancer says he needs 3-4 weeks to discharge from bank of melb. So say if we are not doing a bridging loan, it means by about 25th October,we have to ask bank of melb to discharge for settlement on 25th November.
But if we do go ahead with bridging loan with commbank, they want refinance of old ppor from bank of melb.
So given bank of melb refinance to commbank takes 3-4 weeks, does it mean say I sign for refinance next week, I will get the cba to hold the mortgage to my old ppor around mid October, and then on 25th October I have to get commbank to discharge it for settlement.
Does it work like that?

 

Your conveyencer is correct.

I think you're making it more complicated than it should be.

If you can't sell your PPOR in 6 months there is a problem, and that would suggest it isn't going to sell in another 6 months time.

Wait, are you the guy who said you're worried about the deposit cheque bouncing because you didn't like the look of the guy?

 

If you don't sell the first property within 6 months it is very likely that the bank will do nothing but give you an extension.

 

If you "do know what you are doing".........
You are the only one !

 

Cba and bom have diferent policies around bridging.

Bom base their servicing on the total of capitalising interest for 6 months of the peak debt, then selling the first property at a 10% discount.
If your normal income can then service the remaining loan, the ‘end debt’ you get the loan.

Cba need to see you can service, pay back, the ‘peak debt’. They will let you use any savings you have to supplement your income if required for up to 12 months. If you don’t have savings, but equity, the idea is you can increase your borrowings from the first home to give you enough cash to supliment your income to pay the peak debt repayments for up to 12 months while you sell.

I agree with earlier posters that if you can’t sell in 6 months, you’ll be burning money while you wait to drop the price in the second 6 months.

Many times it’s easier structuring this as an investment purchase. The likely rental income and negative gearing benefits means you can purchase the new property.

There’s nothing stopping you deciding to sell the first one and move into the investment property later.

 

The problem is the new ppor we want to buy costs three times more than our old ppor. Even with savings, we have to use bridging loan.

 

I guess my real question is after refinancing to commbank, does my conveyancer need to discharge from commbank 4 weeks prior to settlement and if yes, once we fill in the discharge form, can we still bid at auction for new ppor?

 

Depends if you want to settle in time. To settle any mortgages need to be discharged. And to discharge a mortgage the banks need time to prepare - usually 10 days is enough. You could speed things up by lodging the discharge before the loan actually settles and you could delay settlement too.

 

did you end up listening to your wife?

 

Taking a step back...

Why are you worried the buyer won't be able to settle? You mentioned you sold a week ago. Is the sale unconditional or still subject to finance etc? You will have more certainty if you wait till their finance is approved.

If the new place will be three times the price of the old place, why not uncomplicate things by waiting till your place settles, and then rent for a short stint while you search for your new PPOR?