Hi all,
we recently put an offer in on an IP that got accepted. It needs some work on it so we negotiated a 20k reduction in the asking price. Bank A gave us pre approval for 90% loan.
Bank A went to value it and the valuer came back saying he'd noted that work needs to be done on the property and requested a building report be done. The bank said that is the report comes back with anything structural then they will struggle to lend the cash. We are hesitant to get the report as we know what the report will come back with, and that there is structural work that needs to be done.
Our agent put us in contact with Bank B who are known to be more........ flexible. We told them the situation and having asked their finance section came back to us saying that there shouldn't be a problem. They initially said they would not need a building report, only a builders quote for the work to be done and for us to take out a building loan to that amount to add to the mortgage (same rates etc etc) which seemed fine to us. Saves using our own savings!!
They then came back and said because there are 4 units on one title they could not offer it to us as residential but instead a commercial/business loan. They would also need a 20% deposit.
I'm in a quandary as to which avenue to take:
Get a builders report done anyway and hope Bank A are happy and leave it at that and I move forward with them only committing a 10% deposit.
Go with Bank B with their suggestion but with 20% deposit. As yet we have not had pre approval yet with Bank B so their caller might say the same thing and need a report. They did say it was unlikely, but are they just saying that to draw us in?
Thoughts?
we recently put an offer in on an IP that got accepted. It needs some work on it so we negotiated a 20k reduction in the asking price. Bank A gave us pre approval for 90% loan.
Bank A went to value it and the valuer came back saying he'd noted that work needs to be done on the property and requested a building report be done. The bank said that is the report comes back with anything structural then they will struggle to lend the cash. We are hesitant to get the report as we know what the report will come back with, and that there is structural work that needs to be done.
Our agent put us in contact with Bank B who are known to be more........ flexible. We told them the situation and having asked their finance section came back to us saying that there shouldn't be a problem. They initially said they would not need a building report, only a builders quote for the work to be done and for us to take out a building loan to that amount to add to the mortgage (same rates etc etc) which seemed fine to us. Saves using our own savings!!
They then came back and said because there are 4 units on one title they could not offer it to us as residential but instead a commercial/business loan. They would also need a 20% deposit.
I'm in a quandary as to which avenue to take:
Get a builders report done anyway and hope Bank A are happy and leave it at that and I move forward with them only committing a 10% deposit.
Go with Bank B with their suggestion but with 20% deposit. As yet we have not had pre approval yet with Bank B so their caller might say the same thing and need a report. They did say it was unlikely, but are they just saying that to draw us in?
Thoughts?