95% LVR a thing of the past?

Hi Michael

Yes still possible but you would want to either have a bit of equity in another property good track record on your savings history and been employed by the same employer (not same field) for a 2-3 years +.

No easy esepcially with lenders looking for reasons to say NO rather than Yes but can still be achieved.
Thanks Richard,

Im based in Toowoomba and am looking at 95 or 90% LVR later in 2010... Im looking for a broker, and I'll get in touch with you later on....
I have equity in another property but just got a 110% LVR in Brisbane

I doubt its 110% LVR unless you were given 110% without using the equity from the property.........

If you are using equity from another property then that is part of the deposit not LVR for the new property.

Say I used 10% from my existing property to fund 5% deposit and 5% buying cost for a new property and got a 95% loan for the new property then I would not say that I got a 105% LVR for the new property.

The LVR for the new property will be 95% but I used 10% from existing property for the other costs......

You would have only got 110% by cross collateralising the 2 securities which for a long term strategy is something i would certainly not recommend.

Simply structuring it properly from day 1 makes life a lot easier and cleaner and avoids potential pitfalls in the future.

Pleasure Michael happy to assist or any other questions.
Well 2 mortgages - one on my PPOR and one on IP - the one on my IP is more than I paid for the property - PPOR is not mentioned at all and has nothing to do with IP . The IP needs some work so they lent me more money to do it up - it was a fight but got there.
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The lender has definitely cross collaterlaised the two properties. Check the loan offer documents. It'll list both your previous and new property as security for the new loan.

There are still a few lenders who'll lend to 95%, but they are tricky to work with and the best loan might depend on a number of factors. If there's a way to get 10% plus costs together, it's much easier, with a lot more options.
Thanks for that I just checked again on the documents as we have not signed the final ones - the IP is the secured property BUT the loan is with the same bank so nothing would surprise me.
It was an interesting situation - the Bank val came in over the price ( but he later changed his valuation when that was pointed out to him! Scares me to think this valuer has my life in his hands he is the only one in the area and well that's a whole other story over a glass or few of wine!) Bank stalled because the rent would not cover loan before renos ( probably will not after but its on 2 lots .......) House in my name but my both DH and I are taking out the loan.

I will go over it again - I am sure you are probably right but there is no way another bank will lend us the money its the only option for us till we come off fixed from our PPOR
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So frustrating isn't it? It's a big chunk of difference from 90 to 95.

Then you think you are getting close and the purchasing costs add another 6!

(Sorry I'm typing in the dark and my touch typing means I've forgotten where the percentage sign thing is on the keyboard.)

No help, just adding that I'm annoyed too as we can afford another but have no deposit/equity YET
Hello everyone
My first post on here after doing alot of reading (first time I have really enjoyed a forum such as this one )
I'm in the same position, I have 2 IP's and will settle on the 3rd on the 11 of Jan 10
(no PPOR) last property has a 95% loan on it so have used up all my monies and hope to use up any equity I have by putting granny flats on the properties , but all of the properties are either neutral or cf + and will be very + after the granny flats are put on( depending on interest rate of cause) but I would also like to get more properties while equity is building and have come a brick wall of knowing what to do , I know for a fact there will be away around this issue and all I have to do is find out what it is , but I'm there have been a lot of people on this forum who have come across the same issue and would love to hear how everyone got round this one hurdle .
Definitely possible.....try Credit Union Australia.

You will need to push...but they should be able to do a 95% lend. However, the are quite thorough in assessing your loan.

With the GFC, and lenders tightening their criteria, is it impossible to get a 95% LVR? Or is it possible but difficult? Thanks :confused:
Hi Michael

There are a number of lenders which will do 95%LVR

Some require that you be an existing credit facility customer eg mortgage loan, personal loan or credit card facility

Other lenders will do 95%LVR provided that you can demonstrate Genuine Savings or 20% equity in another property

Some will lend to 95% including the mortgage insurance / the borrower pays the mortgage insurance

Other lenders will lend to 95% and capitalise the mortgage insurance premium to the loan

It will depend on your circumstances at the time.

As with everything, it pays to plan ahead. Some of the 95% lenders are not big lenders ie they use tight servicing models when assessing borrowing capacity, and sometimes you can get a better deal by using 90% and borrowing against other properties for the remaining 10% plus stamps and other expenses.

It's all about the deal, rather than one factor of the deal.

However, as you have some months before you plan to buy, use the time wisely to manoevre yourself into the best position rather than leaving your enquiries to the last minute.

In the later months of 2010either we will be back to better credit conditions where 95s are common, or we will degrade a little more into the credit cycle.

despite the fact that funds are starting to loosen, its still tough but not impossible to access a 95 % or plus lend, but as has been mentioned already, there are many factors, some of which are beyond the borrower, as to if a an LMI provider will provide coverage .

I guess these things cycle, no doubt some dodgy financial institution will offer whateveryouwant at the right price...
I guess these things cycle, no doubt some dodgy financial institution will offer whateveryouwant at the right price...

There's plenty of lenders who're happy to write 95% or higher loans. Some are competitive on rates, others aren't. The problem is the mortgage insurers don't want to underwrite them as they're seen as too risky.

Insurance took a HUGE hit in the GFC, they're currently very risk adverse as a result.