WANTED: Broker/Finance/etc. Solution required - Newcastle NSW

[justallan]

A person I know owns a church. Next to the church is a small block of land he would like to purchase. I believe the present owners bought it about 18 months ago for about $70,000. They planned to build a commercial building on it. But local council required a car park - which of course, the block is too small for.

The guy I know cannot get finance with his bank. i.e. The loan amount is too small for them to offer him a commercial loan.

Is there someone in the forums that does (or could) service Newcastle NSW - and thinks they might have a way around this?

I'll have to check... But he *might* still be repaying a loan for the church. If so, I assume a new loan could be arranged that includes the vacant block purchase. Would this solve the problem? (I'll try to remember to check this with him tonight.)

Allan

 

[Propertunity]

A few things:
1. Is it still an operational chuch or being used for something else?
2. Is the small block beside the church zoned commercial?
3. Is the church zoned commercial? ....because most churches I know of, have a residential zoning.
So my Q really goes to, 'are you trying to refinace a resi zoned church and a commerially zoned vacant block into one loan?

Any MB in any part of the country would be able to help you with the re-financing side of things. It's all National these days.

Plenty of good brokers on the SS forum here.

 

[Aaron_C]

Yeah this shouldn't be a problem you don't need a commercial loan for it if the land can be used for residential purposes.

 

[Rolf Latham]

A person I know owns a church. Next to the church is a small block of land he would like to purchase. I believe the present owners bought it about 18 months ago for about $70,000. They planned to build a commercial building on it. But local council required a car park - which of course, the block is too small for.

The guy I know cannot get finance with his bank. i.e. The loan amount is too small for them to offer him a commercial loan.

Is there someone in the forums that does (or could) service Newcastle NSW - and thinks they might have a way around this?

I'll have to check... But he *might* still be repaying a loan for the church. If so, I assume a new loan could be arranged that includes the vacant block purchase. Would this solve the problem? (I'll try to remember to check this with him tonight.)

Allan

Hi Allan

Im sure there will be someone that will take it on

Churches are a somewhat specialised security and not easy to get loans on

ta

rolf

 

[Aaron_C]

Churchs are hard to get loans for due to the NCCP rules but if the church isn't the one buying it then it's fine.

 

[justallan]

1. Yes.
2. Yes.
3. Not sure. Will check.

So my Q really goes to, 'are you trying to refinace a resi zoned church and a commerially zoned vacant block into one loan?

Possibly. I don't know. I'm trying to find a way around the problem. All I know is it's in the too hard basket for his bank. They told him they won't finance a commercial loan for an amount that low.

And local council MIGHT consider rezoning to the same as the church, since it adjoins (there's not even a dividing fence atm). But would they allow this before it sells, so he could then just get a residential loan? Who knows. Will suggest it to him tonight though.

Plenty of good brokers on the SS forum here.

Thanks!

 

[justallan]

Churches are a somewhat specialised security and not easy to get loans on

Just in case it makes a difference... The church property either already has a loan being repaid (for a few years now), or, is already fully repaid. Will check.

 

[Aaron_C]

Just in case it makes a difference... The church property either already has a loan being repaid (for a few years now), or, is already fully repaid. Will check.

I got a loan for a church a few years ago - they had to get the guarantor of the Pastor running the church in order to service the loan. These days with NCCP it is much harder to get away with it under 'responsible' lending. Even if it's a commercial property, banks get very scared of accidentally breaching the law.

 

[justallan]

Ok...

* Yes, it is an operational church.
* The small block beside the church is zoned commercial.
* The church property is zoned residential.
* Church property has a current loan.

 

[Rolf Latham]

Ok...

* Yes, it is an operational church.
* The small block beside the church is zoned commercial.
* The church property is zoned residential.
* Church property has a current loan.

so the most logical could be to extend the current church loan with the existing lender?


ta
rolf

 

[justallan]

Alas, he's tried that...

1. Because the two properties are zoned differently, they're not interested in combining the two on one loan.

2. And because the loan amount for the block is small, they won't grant him a commercial loan.

Business must be good for the banks to be turning down loans.

 

[Rolf Latham]

Alas, he's tried that...

1. Because the two properties are zoned differently, they're not interested in combining the two on one loan.

2. And because the loan amount for the block is small, they won't grant him a commercial loan.

Business must be good for the banks to be turning down loans.

getting a stand alone resi loan for that amount of money wouldnt be easy either.

To many lenders ( and just about all brokers) a 50 or 60 k loan costs more to draw up than it will rtn for many years.

Hence many lender have min loan limits

ta
rolf

 

[Peter_Tersteeg]

So essentially you're looking at mixed use lending.

The challenge here is that residential lenders don't want it because there's a commercial component. Commercial lenders will look at the property and can't finance the residential component as it doesn't fit under their credit licence.

I know a couple of lenders that will deal with this on a 70% lend and possibly on an 80% LVR. I don't know how the church aspect will fit into it, but I suspect it won't be a real problem if affordability is strong. Loan size could also be an issue.

It is a very tricky combination of critiera

 

[Aaron_C]

Yep this is the problem - the security is neither residential nor commercial. This is why things like serviced apartments and student accommodation is so hard to get funding for.

 

[Kirsti]

HI justallen,

I work for a Newcastle based credit union that does microbusiness loans. I can run it past the lending guys and PM you if they're interested.
If affordability is fine and it's only the min amount that the trouble why not apply for a larger loan (or even better, line of credit) but only use what you need? Apply for say a $150k limit, take the $70k for purchase and don't use the rest.

 

[Rolf Latham]

HI justallen,

I work for a Newcastle based credit union that does microbusiness loans. I can run it past the lending guys and PM you if they're interested.
If affordability is fine and it's only the min amount that the trouble why not apply for a larger loan (or even better, line of credit) but only use what you need? Apply for say a $150k limit, take the $70k for purchase and don't use the rest.

Hiya


150 k on a 70 k security ?

Where do I apply pls ?

ta

rolf