Uncle overseas. Bank want his home. Advice please!

[KidGeeq]

My uncle owns a property in Werribee, Victoria. He and three family friends reside in the home.

He has paid the mortgage consistently over the past 8 years. An amount of $140,000 is still owed to the bank.

Recently, due to a number of reasons he has failed to meet repayments for the last four months. Tenants are family friends who do not pay rent. As a result the bank has threatened to repossess the property. The owner is currently overseas and does not plan on returning to Australia. I am in a position to pay the 4 months owing to reduce pressure from the bank and allow time for a transfer of ownership into my name so I can take over the mortgage.

What is involved in such a procedure? Please provide me with guidance. Does the fact that he is overseas change legalities? Furthermore, would I apply for a loan like a normal investment property?

All input is much appreciated. Thanks

 

[Aaron_C]

Well for you to 'take over' the mortgage he would have to sell the property to you and you will need to apply for the loan like a normal purchaser....

 

[Terry_w]

Where he is doesn't change things. Mortgagee can take possession if he isn't paying, but it may assist in delaying tactics.

You should seek legal advice before having the property transferred to you, especially if under market value. Also seek legal advice on paying his loan repayments - bank may still take possession. Can you get your money back?

 

[LexCon]

To go ahead I would first speck to the bank to let them know what you have planned. You should then get a Licenced Real Estate Agent to give you a "curbside valuation" (marker appraisal of the property). What ever price the agent comes up with that is what the stamp duty will be calculated on. You will then need a solicitor or a conveyancer to prepare a contract for the sale of the property. If there was no bank involved you could avoid having to have a contract.

You will have to take out a new mortgage even if it is the same bank.

You should do your sums and make sure you what to take on such a financial commitment. You will also have to think about how easy it will be to have the current "tenants" to vacate the property.

I would take a lot of advice before I committed to anything if I were you.

 

[NedKelly]

Maybe the "tenants" should pay some rent. I doubt they will find anywhere cheaper!

 

[Macca]

I would tell the current tenants of the situation with the bank, if they want to stay then they better pay enough rent to meet the repayments. This may buy you some time while you try to put a deal together with the bank.

It will also get them used to the idea that the free ride is over, even on the pension or dole, people get enough cash to contribute something towards rent.

Before making any payments to the bank you should get legal advice and discuss it all with the bank. Make sure you get it all in writing before paying anything off the loan.

 

[pinkboy]

To go ahead I would first speck to the bank to let them know what you have planned. You should then get a Licenced Real Estate Agent to give you a "curbside valuation" (marker appraisal of the property). What ever price the agent comes up with that is what the stamp duty will be calculated on. You will then need a solicitor or a conveyancer to prepare a contract for the sale of the property. If there was no bank involved you could avoid having to have a contract.

You will have to take out a new mortgage even if it is the same bank.

You should do your sums and make sure you what to take on such a financial commitment. You will also have to think about how easy it will be to have the current "tenants" to vacate the property.

I would take a lot of advice before I committed to anything if I were you.

I hope you meant Property Valuer?

pinkboy

 

[wylie]

I hope you meant Property Valuer?

pinkboy

Whilst a property valuer could do this, I would think a transfer between family members can be done using an appraisal with three comparables. The important thing is that the price must be realistic. I'd suggest this is fine, but the agent would need to go in and take a good look around, take photos etc. Kerbside would not be enough for the agent to know what is inside, and what comparables would be appropriate.

You will be paying stamp duty (and vendor will probably be paying capital gains tax) so you do need a proper idea of what the house is worth and you would need to be able to back up the price so having an appraisal with appropriate comparables, detailed reasons why yours is worth more or less etc is important. You'll get this from a good agent anyway.

 

[LexCon]

In Victoria for duty payable purposes between related persons a sworn valuation is not required. The Victorian State Revenue Office will accept a market appraisal letter from a Licenced Real Estate Agent.

 

[lizzie]

My first question is ... is the uncle prepared to sell you the home?