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Off the plan IP financing

Discussion in 'Real Estate' started by glennt, 28th Oct, 2010.

  1. glennt

    glennt Member

    Joined:
    24th Jul, 2009
    Posts:
    13
    Location:
    Adelaide
    I bought an off the plan IP in Melbourne. Bank valuation came in slightly more than what I have agreed to pay two and a half years ago.

    My question is How does this effect my finance as far as how much to borrow or how much the bank will lend ?

    Initial cost = $540k in 2008
    Bank valuation = $551k in 2010 Oct

    Glenn
    :p
     
  2. Billv

    Billv Getting there

    Joined:
    15th Jul, 2007
    Posts:
    1,796
    Location:
    Sydney, NSW
    Hi Glenn

    Now you could put down a lower deposit.
    Are you putting down a 20% deposit?
    Previously the bank would have lend you 80% of the property value or $432K and now they'll lend you up to $440.8K.
    So your deposit will be reduced by $8.8K
     
  3. glennt

    glennt Member

    Joined:
    24th Jul, 2009
    Posts:
    13
    Location:
    Adelaide
    Off the plan purchase

    Yes I was putting down a 20% deposit. My option to purchase an IP off the plan was risky after signing I realised from friends and my own investigation that it can turn bad. Given the global financial turmoil in the last three years I think I can consider myself lucky I'm gaining even though slightly.

    Thanks for your comments.