Bank blacklist

[Tony3008]

Probably not the properties that most of us would look at but ...

"A list of ''unacceptable'' buildings obtained by BusinessDay, circulated by one of the big four banks to its mortgage brokers late in 2010, bars finance for all developments associated with the federal government's National Rental Affordability Scheme, an initiative designed to boost housing for low-income earners around the country.

Most other banks have also refused to finance investors or buyers for NRAS properties, apart from St George, which accepts borrowers for one project in Queensland.

The list of unacceptable properties also bars or severely restricts finance for at least 146 projects in Victoria, 100 in New South Wales and the ACT and a further 127 in Queensland, most of which are serviced apartments, resorts or student accommodation. The list also includes inner-city apartments, cottages on the coast west of Melbourne and a resort south-east of the city near Western Port Bay....."

http://www.theage.com.au/business/property/bank-blacklist-puts-floor-under-risk-20110911-1k455.html

 

[Mick C]

Hi

You be surprised, it's not just Serviced apartments, resorts or student accommodation that are on the black list....Some standard 50 squ meter + apartment are on there because of

1. Low keep time/ high turn over ( meaning how how a investor/homeowner keeps the property for on average)

2. Builder reputation

3. Bank's negative past dealing with management

4. Exposure limit

5. Poor design ( ie no windows) or no laundry etc..

P.s A lot of them that are on the list comes at no surprise...The type of property that only suit some unique investors/home owners ; so the bank is doing a good thing i would have to say

Regards
Michael.

 

[Terryw]

The SMH quoted some guy from Shape Home Loans:

Shape Home Loans mortgage broker Michael Chan said the big four banks' traditional lending restrictions on apartments of less than 50 square metres were crumbling in the face of a flood of smaller apartments coming on to the Melbourne market.

Read more: http://www.smh.com.au/business/prop...-under-risk-20110911-1k455.html#ixzz1Xh1s1H2M

 

[Mick C]

Was interviewed to comment on smaller apartments and do bank still lend under 50 squ meters.

Regards
Michael

 

[hhpb89]

I'd love to know who the builders with a bad reputation are.

 

[Aaron_C]

I'd love to know who the builders with a bad reputation are.

It's hard to blame the builder...ultimately the blame for bad quality/ugly buildings falls on the developer who finances it and the council who approves it.

 

[Rolf Latham]

At first I thought this was a what BANK Black list and my immediate response was going to be, well it depends on the day of the week, the slope of the land, the shape of the moon, and the left shoe size of the borrower

ta
rolf

 

[Peter_Tersteeg]

I read the article this morning. Some great comments and koodos to Michael!

As an example, Westpac has a list on their broker website on addresses they simply won't fund under any circumstances. Other locations can be more arbitary as Rolf has indicated.

No reasons on these lists are given, just don't bother trying to finance it with that lender. Even then, many lenders don't publish this information. Fortuantely these lists aren't that large (compared with the number of properties out there), so if you buy half decent properties, it's unlikely to catch you out. Just avoid student accomidation, serviced appartments and developments where there's a reasonable number of titles below 50sqm.

In most cases, it is possible to find a lender that will write a loan against just about any location, as long as you can come to the party with the right LVR and be willing to pay for it.