Help with finance ideas??? PLEASE IM DESPERATE

I would be greatful for any ideas to my following problem. I know a lack of knowledge and believing what people have told me without doing my own due diligence has got me into this spot. I have learnt valuable lesson but I am now looking for a solution.

the short to the point, facts

purchased off the plan unit in Melbourne in Sept 07 for $365000

Paid $36500 deposit which broker funded from the equity in out PPOR ( i now know he did low Doc and fudged our income by 50k. He does'nt work there anymore so i can go and yell at him)

PPOR On gold coast owes bank $307000 (which incs IP deposit)

Current approx value PPOR $400k - 410k (haven't had a formal valuation)

Settlement for IP in 5 weeks balance owing + costs approx $332k

PROBLEM!!! I have been chasing finance for settlement since October 2009. I keep hitting brick walls because I am self employed and my Wife and i split our income and based on that income and expenses we can only finance approx $292k. went down the low doc (Ain't really low doc anymore as have to supply BAS) can only get finance to 80%. thought of asking our olds to lend us the additional 10% but they are retired and have been advised that they would have a hard time lending us the money on their equity.

if i can't settle we will lose deposit($36500) plus pay 16% p.a penalty interest untill settled (approx $4500). This will bust us.

please if anyone has a creative idea I would welcome any comments.

Thanks Heaps. Chris
 
Credit card, personal loan? sell a car? whatever it takes.

might say no to the car, but it will save the 36500 paid and will give you money if u resell straight away as its higher then purchase price.

otherwise could try offloading it prior to settlement.
 
Thanks Nathan . i will crunch some numbers on the credit card front. You have a point , short term pain and i could make up some money on a resell.

On the resell front I have approached vendor through my solicitor and asked for right to onsell but was declined stating that in the contact clause 26 wont let me do this until i settle.

I do have the ability to nominate another person to to my contract but how do you advertise that? Any way long story short, vendor agreed to allow on sell thru the investment realestate I originally purchased off. They have listed it $415k and will charge me $20750 for the sale . Thats 5%. I'm pretty sure thats higher than most agents. They have me bent over at the moment and they are charging in without lube!!
 
Hiya Chris

Id have a bit more of a fish around to see if the 292 is the actual max..........or if its the max based on some middle ground lender.

The unit in Melb must be worth heaps more now than when you bought it ?


ta
rolf
 
Difficult to pick up where another Broker left off but surely if the market value of your PPOR is 400K cant you increase the Lodoc loan on the property to incorporate the additional 10%.

Appreciate some lenders wont do a lodoc refi or increase but with that much equity there must be a way.

Course will depend on whether current lender requires BAS + Trading figures to do an increase.

Always a way around these things.
 
Check out the lenders that don't go through brokers. IMB, ME, etc. You may have better servicability with one of them???

Could your parents take out a personal loan?
 
whats the re sale price on the unit , perhaps you could balance it as experience , and get the cost back?? but i dont know the value of the unit??
 
There are a lot of variables in this however the PPOR must have been valued at around $385k in 2007 so there should be reasonable growth there. If the value of the new property is $415k then there are ways to have it re-valued at the current level rather than the purchase price. I know of at least one lender who will do that if the contract is more than 12 months old.
This would give you almost enough to complete, with just a few thousand shortfall.

As a lo doc loan, there are some lenders that don't require BAS. You may pay a higher rate on a refinance but the purchase should be OK.

The other option is looking at the borrowing capacity with other lenders on a fully verified basis. I am using one at the moment that has a significant difference between those who have always provided the greatest borrowing power. I had never considered this lender before (and probably neither had many other Brokers) however the difference means I am putting a lot of business there at the moment.
 
There are a lot of variables in this however the PPOR must have been valued at around $385k in 2007 so there should be reasonable growth there. If the value of the new property is $415k then there are ways to have it re-valued at the current level rather than the purchase price. I know of at least one lender who will do that if the contract is more than 12 months old.
This would give you almost enough to complete, with just a few thousand shortfall.

As a lo doc loan, there are some lenders that don't require BAS. You may pay a higher rate on a refinance but the purchase should be OK.

The other option is looking at the borrowing capacity with other lenders on a fully verified basis. I am using one at the moment that has a significant difference between those who have always provided the greatest borrowing power. I had never considered this lender before (and probably neither had many other Brokers) however the difference means I am putting a lot of business there at the moment.

Hi Finanial Plus

Welome to Somersoft, perhaps you could tell cbddqld who this lender is
which may be of great assistance to him.

Cheers

Pete
 
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AMP maybe ? ,................but then................there are bunch of other 2nd tiers whose servicing isnt much below them.

AMP are aaaaaaaaawful slow at the moment.

ta
rolf
 
Just spoke with AMP. They want 12 months BAS on their lo docs (despite their website being silent on the point). The LMI insurer is Gemworth and was advised BAS required on all lo docs (even those under 60% lvr)
 
I was also thinking that you should be able to borrow against increased market value ($415K) rather than purchase price. Talk to a good broker and do your utmost to finance this deal. And 5 weeks is not a lot of time; you've not got a day to lose.

With regard to the re-listing at $415K... are they only willing to do this up until the settlement date? I assume so, because I assume that come settlement day + 1, if you've not settled,they can keep your $36.5K, put it back on the market and sell it again for $415K, meaning the vendor would be better off by $36.5K + $50K (increased purchase price from $365K to $415K), or $86.5K.

The vendor is strongly financially motivated for you not to settle. I assume their offer to on-sell is only good for the 5 weeks remaining? I think they're being pretty generous, given that the contract places them under no obligation to do so. Far from "charging in without lube", bear in mind that they'll lose $86.5K if you are able to on-sell. And if you do on-sell at less than $415K due to your particular circumstances creating urgency to obtain a sale, bear in mind that you've set a comparable figure which de-values the rest of the development somewhat. So their offer is really more than reasonable, IMHO.

I'd be listing ASAP, and take any price above $365K, unless you're exceedingly confident that you'll be able to settle.
 
IT IS ALL SORTED !!!!!! HOORAY. I want to say a VERY BIG THANK YOU to Kathy and Bruce from Financial Plus. Without all of their amazing efforts and extraordinary service, I don't think we would now be owners of an investment property.

Kathy and Bruce managed to save us thousand of dollars in penalties if we couldn't have sorted out finance for our off the plan purchase from three years ago.

We were faced with hurdles at every turn but Kathy and Bruce managed to jump them all.

Thank you to everyone for their input.

But I can't say THANK YOU enough to Kathy and Bruce. I look forward to recommending you to everyone I know for their financing needs.

Cheers
Chris.
 
Hi Chris

Thats a great outcome.

Good to see brokers getting some good feedback, obviously a bank direct could not have sorted that one.


ta
rolf
 
I guess you were damned lucky that you posted this thread when you did and that a broker from the Gold Coast happned to pop by at that particular time. Timing can be an amazing thing sometimes ;)
 
I guess you were damned lucky that you posted this thread when you did and that a broker from the Gold Coast happned to pop by at that particular time. Timing can be an amazing thing sometimes ;)

My thoughts too.... but then I smacked myself for being so darned suspicious.

I even checked the joining dates....
 
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