x-collat and new ppor purchase

[lordjem]

I hope this is the right area for this email.

I am after a creative way to transfer the x-collat security in my current ppor to a new ppor.

my situation is as follows:

borrowed 106% for ip, using ppor as security.
I am selling my ppor to purchase a new ppor.
Timing of situation means that I have to sell before I can buy or put deposit on new ppor.
Bank needs to be able to maintain security, so either have to make a temporary cash security (using my LOC), or pay out part of ip loan so have 80% LVR.

The period between selling ppor and buying new ppor may be up to 3 months, so security needs to cover that period.

Does anyone have any other ideas of ways to transfer the security which the bank would be happy with?

Cheers

Jeremy

 

[Mikhaila]

Hi lordjem,

Did you talk to the bank? They probably will be the best first point of contact as I see the situation. You may find creative solutions but bank may not like it. This is bank's job to advise/suggest the possible ways.

I do not have any creative ways to suggest, but really your temporary cash security solution sounds pretty good and easy to me.

 

[Rolf Latham]

Hiya

Use cash from the LOC as a short term term deposit.

Ahh the fun of xcoll :O)

ta

rolf

 

[lordjem]

Thanks for the replies to date.
I have spoken to the bank who suggested the cash method.
The way i see it, the bank will only offer those ideas and methods that suit their purposes and fit in all their boxes.
I have managed before to convince them of doing things out of their comfort zone, so I am thinking that maybe they don't know other ways to maintain the security.
Hence my request for creative ways to do things.

LOC seems the simplest, but still costs in interest difference between short term term deposit rate and LOC interest rate.

Rolf, you are sooo right.
I have learnt a lesson here about x-coll which I will hopefully never reproduce again.
I suppose if I can get a valuation of my ip that would match the criteria, then there would be no need for x-coll. Maybe I'll just have to wait a couple of years for further growth.

Thanks again for your responses

Jeremy