Hi, I have just signed a contract for $420000 with 30 day settlement. I am looking for a low Doc loan that allows me to offer my mothers property as a guarantee or second mortgage so I don’t have to come up with 20%. I have a property on the market when this sells I can release my mothers guarantee. So far I am being told that the only way to do it with low doc is my mother has to be a 1%owner of my propety and me a 1% owner of her property which won’t work.
Does any one have any suggestions?I am assuming that your income allows you to service the loan so if this is the case i can’t see why a Lodoc loan would be required.
Rams recently released a product which maybe of interest to you. Or alternatively try St George or CBA.
If i have missed the concept of your post why not consider arranging 80% standalone lodoc on your new property and 20% standalone lodoc on your mothers. Again assume her property is unencumbered.
Cheers Richard
richard at castlewhite.com.au
Email me for details of our Qld wrap CD which gives you a full Installment Contract.Richard Taylor | Australia's leading private lender
Banks do not like third party guarrantees for obvious reasons – they would have to evict and sell your mum up if you default.
I know of one lender that will do this, depending on LVRs etc. Both yourself and your mum with have to take separate legal adivce. Rates are around 8%.
However, a better option would be to do what Richard suggested. Take a 20% loan on your mum’s property, for the deposit.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Without knowing your personal information or your mother’s…
Your loan seems set so there is no issue. I assume you want the 20% deposit plus any fees. Looks like you want $100,000 from your mum’s property.
If your mum is eligible for a loan, she can just do a full doc application in her name and give you the $100,000. Same applies to a low doc application. There are loans out there that allow your mum to be self employed for one day to get the loan. A no doc loan may also be an option if there is enough equity in your mother’s property.
At the very least, there is no need to tie up the properties through cross-collateralising or putting each other on title. The situation you speak of is very common in the industry. I would suggest finding a new mortgage adviser – QUICKLY – as you only have 30 days.
It does not sound like a problem at all.
Robert Bou-Hamdan
Mortgage AdviserWith the low doc loan it is not required if you are able to supply two years worth of tax returns, which would mean you are eligible for full doc rates. If you want to use your mums property as an extra security it would be fine, but your fees would be higher.
Depending on location is the LVR that the borrower will offer and this applies with no doc loans as well. They will only do in certain locations and the interest rates are much higher. They mainly look at metro regions, so if it is metro you are eligible. If your mum is working then it would improve your situation. If your mum is on Centrelink entitlements just ensure you use that to assist in servicability.
So say your property is worth $600,000 and mums is $400,000 and the finance they offer is a 60% LVR then you are entitled to access the full $600,000. This is a very widely used means of financing, but it carriers higher risk as if you default on your loan the lender is able to sell your mums property in order to have the funds returned.
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