My fiance has taken out a $329,000 mortgage, of which $260,000 was used to purchase a house on a corner block (which has now been subdivided). This leaves her with an amount of $69,000 to potentially use for building a townhouse on the subdivided block of land. We are thinking of selling off the existing house - valued around $250,000 by the estate agent and buying another property in which to live (as the existing one doesn't meet our criteria). This will then leave us with a subdivided lot with council approval to build a townhouse. So ideally we'd like to sell the existing house, build a townhouse on the subdivided lot (for rental income) and take out another mortgage for a PPOR. I was wondering what would be the best move in our current situation:
Before the sale of the existing house, using the existing $69,000 as a deposit on a new place (we have saved very little towards a deposit)
Waiting until after the sale of the exisiting house (leaving a mortgage amount of around $69,000) and refinancing with the same bank (Westpac)
Any other options
I realise we should avoid cross-collateralising, but given our fastly approaching wedding and the complications arising from re-financing, I'm not sure how much we'd be able to borrow from another bank. Basic calculations from bank's websites are about $450,000 - potentially more if we sell the existing house.
Any advice greatly appreciated
Before the sale of the existing house, using the existing $69,000 as a deposit on a new place (we have saved very little towards a deposit)
Waiting until after the sale of the exisiting house (leaving a mortgage amount of around $69,000) and refinancing with the same bank (Westpac)
Any other options
I realise we should avoid cross-collateralising, but given our fastly approaching wedding and the complications arising from re-financing, I'm not sure how much we'd be able to borrow from another bank. Basic calculations from bank's websites are about $450,000 - potentially more if we sell the existing house.
Any advice greatly appreciated
