We want to build a rooming house with 9 self contained bedrooms. I heard it has to be a commercial loan. Is there any commercial loan that only lends for the build, and let us stay with the current loan for the land? And look at the expected rental income only, without looking at our other income?
No. Lenders don’t like to share, so you can only have one loan per ‘security’ or one mortgage per property. They need to assess your total income and expenses. The only exception might be in the commercial space where the title is in a company name.
already used up to purchase another land. Now is looking to build on that land. Would commercial loan have easier serviceability calculation than residential?
You will need to supply security for a loan, usually, and the security is a mortgage over land - with a build attached to it sometimes. The building goes with the land.
Has anyone gone through rooming house process yet ? Can anyone kindly share pros and cons of the Buiding a rooming house please ? Thanks in advance