I am currently with CBA because all of our business and personal accounts are with them and also I have a good rate which is 4.8% variable owing about 480 k. But more importantly because we use offset / redraw quite often and their online access is pretty good.
I have decided to purchase a new property and I am finding their agents a bit difficult to work with.
From what they are saying, I have roughly about 520k worth of equity on the house which I can use 80% of it as deposit for the new investment property.
I am planning to make sure that the new property does not cost any more than 850k including stamp duty and legal costs which I am also planning to borrow.
Now onto the questions.
They are saying that they can only tell me that the pre-approval will be at 5.2% rate and they cant give me the exact rate until I have actually purchased the property (regardless of whether it is fixed or variable). Is this correct?
They also cannot commit to evaluating my current house so they can determine the exact equity (unless if I paid for it to be evaluated) But they want to do this at the time of purchase of the new place, which makes things a bit uncertain in terms of the final amount of equity I can gain and if it can avoid mortgage insurance on the IP. Is there a way around this?
They are also saying that if I purchase the new property with the equity on the current property which I live in, and if I decide to upgrade my current property they will need a cash deposit as security for the investment property if I was to sell my current house. I wanted to understand that if I was to buy another property as our place of residence and then sell the place I live in currently, how will that work with regards to the investment property?
They are also saying I may need to pay stamp duty out of my pocket because they can only let me borrow the money if the house has settled and they have got possession of it which can delay the payment of stamp duty. Is that how it works? How can a bank pay stamp duty so the house can settle?
Finally, if the value of the houses drop in future, will they force people to take out mortgage insurance because the equity may no longer cover 80% of the value of the investment house while the investment house may also lose value.
If someone can explain how this works, I would appreciate it.
I have decided to purchase a new property and I am finding their agents a bit difficult to work with.
From what they are saying, I have roughly about 520k worth of equity on the house which I can use 80% of it as deposit for the new investment property.
I am planning to make sure that the new property does not cost any more than 850k including stamp duty and legal costs which I am also planning to borrow.
Now onto the questions.
They are saying that they can only tell me that the pre-approval will be at 5.2% rate and they cant give me the exact rate until I have actually purchased the property (regardless of whether it is fixed or variable). Is this correct?
They also cannot commit to evaluating my current house so they can determine the exact equity (unless if I paid for it to be evaluated) But they want to do this at the time of purchase of the new place, which makes things a bit uncertain in terms of the final amount of equity I can gain and if it can avoid mortgage insurance on the IP. Is there a way around this?
They are also saying that if I purchase the new property with the equity on the current property which I live in, and if I decide to upgrade my current property they will need a cash deposit as security for the investment property if I was to sell my current house. I wanted to understand that if I was to buy another property as our place of residence and then sell the place I live in currently, how will that work with regards to the investment property?
They are also saying I may need to pay stamp duty out of my pocket because they can only let me borrow the money if the house has settled and they have got possession of it which can delay the payment of stamp duty. Is that how it works? How can a bank pay stamp duty so the house can settle?
Finally, if the value of the houses drop in future, will they force people to take out mortgage insurance because the equity may no longer cover 80% of the value of the investment house while the investment house may also lose value.
If someone can explain how this works, I would appreciate it.