Looking at purchasing a new IP, can secure 95%+LMI on purchase price, but the property is not at all livable in current state.
Only have enough $$$ to put up the 5% deposit and buying costs, not enough for a reno.
No point in doing a half reno job to make liveable, only really worth while doing the full reno that will cost approx. $75k inc holding.
How is this usually done? I can see there been two finance options:
1. Do i secure finance to purchase place (serviceablity will be shot as it is not in a liveable condition at the moment)? and once i have settled, seek finance for the renovation/development, using the estimated future property value as the only deposit/gaurantee that i have.
2. Seek one loan, with my 5% or purchase deposit and buying costs as all the $$$ i put forward, and the back approves the purchase price + reno costs, using the future valuation as security???
Est. purchase price $530.
$75k reno (as owner builder - yes, will plan on living it the place once all reno's complete to satisfy this criteria)
Est. valuation after reno - $750k
BTW - This will be the first (legit) owner builder project I have taken on. Installed kitchens, bathrooms, plastered, footing, framing before... I do however feel competent to complete this project, not sure to what extent I will need to prove this to the bank.
cheers, Jake
Only have enough $$$ to put up the 5% deposit and buying costs, not enough for a reno.
No point in doing a half reno job to make liveable, only really worth while doing the full reno that will cost approx. $75k inc holding.
How is this usually done? I can see there been two finance options:
1. Do i secure finance to purchase place (serviceablity will be shot as it is not in a liveable condition at the moment)? and once i have settled, seek finance for the renovation/development, using the estimated future property value as the only deposit/gaurantee that i have.
2. Seek one loan, with my 5% or purchase deposit and buying costs as all the $$$ i put forward, and the back approves the purchase price + reno costs, using the future valuation as security???
Est. purchase price $530.
$75k reno (as owner builder - yes, will plan on living it the place once all reno's complete to satisfy this criteria)
Est. valuation after reno - $750k
BTW - This will be the first (legit) owner builder project I have taken on. Installed kitchens, bathrooms, plastered, footing, framing before... I do however feel competent to complete this project, not sure to what extent I will need to prove this to the bank.
cheers, Jake