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Hi euro 73,Pretty tough finding funding for sub 50m2 studios at the best of times, but when you add NRAS - really tough.
Brisbane Housing Company operates a Head Lease Agreement and only Westpac, STG and RAMS lend against their model, as far as I'm aware.
(Although maaaaaaaaybe you can get NAB to take a look)
If the studio's you are referring to are in the Newstead development, I think they're well under 50m2, maybe down around 40m2, so you're probably going to have a pretty tough time with finance (but you would have a really tough time anyway, even if they didn't have NRAS allocations)
If that's the stock you are in fact referring to - those studio's have been on the market for quite some time- maybe about a year? It's probably fair to assume that's because finance isn't very easy to find for them.
Best bet is probably STG, who do NRAS and will consider sub 50m2 up to 65-70%LVR. But I'd be surprised if they hadn't already reached their maximum exposure inside that development, seeing as there are 19 or 20 of them there which are sub 50m2 and NRAS, and they've been around a year or thereabouts.
As I said earlier, NAB may also be an option, as they're apparently adding a couple of NRAS consortiums to their approved list this week (there will be 4 now, but I dont believe BHC is amongst them- I think its QAHC, Questus, Ethan and AMC) and they "may" look at it for you at 65-70%LVR, as they do sometimes take sub 50m2 stock. Worth asking them at least.
Westpac is out. Rams is out. Firstmac is out. Although all three might be willing to do a one off at a 60ish LVR.
The big 4 bands will not finance NRAS projects:
http://www.theage.com.au/business/property/bank-blacklist-puts-floor-under-risk-20110911-1k455.html
This does a lot. IMO - if borrower defaults in short term, I believe the banks believe they will take a higher loss if there is a fire sale on open market again as it is a narrow type investment that doesn't suit all, and comes with a whole string of limitations if running it under the scheme.
When one buys generally if you can't get the thumbs up from the big 4 (even if their loan rate isn't the best), it does make it more speculative.
The big 4 bands will not finance NRAS projects:
http://www.theage.com.au/business/property/bank-blacklist-puts-floor-under-risk-20110911-1k455.html
Hi,
Sorry about the delayed reply. I was in Toowoomba over the weekend - which I was surprised to see in the latest edition of the Australian Property Investor... interesting - but for another thread eh?
I have too just re-read the entire thread. EURO73 is definitely on the money and I am sorry if this is a repeat of anything you have said Euro. Despite some of the vitriolic posts you have received back you have obviously done this before also.
I have found that if I supply this below list to a broker, they can make it work. Can I also not take the credit for this. This was a list supplied to me by my brother who is a developer in Central Queensland.;
Accelerated Wealth Systems ( Quantum) Firstmac. 80% LVR without LMI. They use 65% Gross Rental for servicing and they DO use 100% of the NRAS incentive as tax free income for servicing. They have the best borrowing capacity by far. for NRAS.
QAHC - Head Lease Agreement Westpac, St G and Rams, 70% LVR without LMI, 85% with LML They use 65% of Gross Rental Income for servicing, They do NOT use the NRAS incentive for servicing, Firstmac, 80% LVR without LML They use 65% Gross Rental for servicing and they DO use 100% of the NRAS incentive as tax free income for serviCing. They have the best borrowing capacity by far, for NRAS.
Affordable Management Corporation Firstmac. 80% LVR without LMI. They use 65% Gross Rental for servicing and they DO use 100% of the NRAS incentive as tax free income for servicing. They have the best borrowing capacity by far. for NRAS.
Bendigo Adelaide - 80% LVR without LMI. They use 65% Gross Rental for servicing and they do NOT use the NRAS incentive for servicing.
Questus - Non Entity Joint Venture via Managed Investment Scheme. Westpac, St G and Rams, 70% LVR without LMI, 85% with LML They use 65% of Gross Rental Income for servicing, They do NOT use the NRAS incentive for servicing,
Firstmac. 80% LVR without LMI. They use 65% Gross Rental for servicing and they DO use 100% of the NRAS incentive
as tax free income for servicing. They have the best borrowing capacity by far. for NRAS.
Aspire - Non Entity Joint Venture Westpac. St G and Rams. 70% LVR without LMI. 85% with LMI. They use 65% of Gross Rental Income for servicing. They do NOT use the NRAS incentive for servicing. Firstmac. 80% LVR without LMI. They use 65% Gross Rental for servicing and they DO use 100% of the NRAS incentive as tax free income for servicing. They have the best borrowing capacity by far. for NRAS
Yarran Group - Non Entity Joint Venture. Westpac.StGandRams. 70% LVR without LMI. 85% with LMI. They use 65% of Gross Rental Income for servicing. They do NOT use the NRAS incentive for servicing.
UAHA - Non Entity Joint Venture Firstmac. 80% LVR without LMI. They use 65% Gross Rental for servicing and they DO use 100% of the NRAS incentive as tax free income for servicing. They have the best borrowing capacity by far, for NRAS.
Ethan Affordable Housing - Non Entity Joint Venture Firstmac. 80% LVR without LMI. They use 65% Gross Rental for servicing and they DO use 100% of the NRAS incentive as tax free income for servicing. They have the best borrowing capacity by far, for NRAS.
Happy Hunting,
CP
P.S. - do I need a signature? - they just seem to get in the way of the post. Perhaps if I had something insightful or witty to say...?
Firstmac are only doing 80% aren't they? If you want 90% then I suggest that including the gov't rebate for servicing will be a no go. If not needed then 90% is most likely possible.
Yes I can see what you are saying, we were thinking of using the boost money from the QLD government for that but was told that many of the properties up there are over what we could afford. >$320k and that the vals for the properties are well under. We can rearrange out budget to a large degree so that we pay many of our monthly expenses yearly after July so that gives us an extra $800 a month but would like a few hundred more.
Victoria has got some lower entry level prices but Stamp Duty there is so much more. Is it possible to capitalise stamp duty or do you have to take it out of your equity or savings. We only have $8k in savings?
Sorry not being a Queenslander I didn't realise that the Boost was in addition to the NRAS incentives. And yes your right, it is paid on settlement.
It's paid after the slab goes down. Not when the land settles. OSR website will confirm that
Hi guys, have their been any agreement in this thread, that NRAS isn't all that its made out to be with the mark up on NRAS property and the consortium fees, as well as the higher interest rates for an NRAS loan?
Qi?
What 'higher interest rates' for loan to buy a property under the NRAS scheme?
A loan is a loan. There is no such thing as 'higher interest rates' - a residential property under the NRAS scheme is not a commercial property - not sure where you have got this information from that you will be charged a higher rate
Cheers