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Perhaps its time to ask my dad for a family pledge to avoid LMI? It will only be needed while we finish off selling our current house.
Ah, thats what i thought, thanks for clearing that up. So that means a LMI of about $5k
All because the ppl who have a contract on PPOR have failed for finance
5K in the toilet.Valued by the bank.
I think my terminology is what wrong. There is an 20% buffer, its the fact that the bank will only lend 80% of the value.
Can someone do the math for me please correctly.
PPOR is valued at 425K
We owe 293KWe wish to buy a block of land for $309 + stamp duty. The block of land has been valued by the bank at 309K.
Please show me the workings so that i can understand for myself.
Thanks.
Its in SA. And no they have not terminated the contract they didnt even notify anybody until i asked. They are trying to sell one of their houses and obtain bridging finance. Isnt bridging finance even harder to get than a normal loan?
Special conditions
(clause 14)SC1 Finance
SC1.1 This contract is conditional upon the Purchaser obtaining, on or before the date specified below, approval in writing for a loan in the amount specified below (or such lesser amount as the Purchaser may accept) at the interest rate specified below and otherwise on such terms and conditions that the lender requires acceptable to the Purchaser, to assist in the purchasing the property (“the approval”). Upon notification of the approval to the vendor this conditional provision will be satisfied and notwithstanding that the lender may subsequently withdraw the approval the Purchaser will be bound by this Contract.SC1.2 The purchaser will use best endeavors to obtain the loan.
SC1.3 In the event that approval is not obtained on or before the latest date for approval and provided the Purchaser has not waived this special condition and communicated such waiver to the Vendor in writing then either party (but, in the case of the Purchaser, provided it has complied with SC1.2) may immediately terminate this Contract by giving notice in writing to the other party.
SC1.4 In the even of termination of the contract pursuant to SC1.3 and provided the Purchaser has complied with SC1.2 all monies paid by or on behalf of the Purchaser shall be repaid to the Purchaser.
SC1.5 In the even of termination of this Contract pursuant to SC1.3 in circumstances where the Purchaser has failed to comply with SC1.2 the Vendor will be entitled to the deposit which is forfeited and proceed against the Purchaser for damages for breach of contract.
Latest date for approval : 22nd December
This doesnt mention anything about what happens if the purchaser neglects to notify anyone about failed finance, It just states that they have to do so on of before the date. They have continued with the sale like they have finance with the signing of the memo of transfer. These clowns have already started sending their mail here also.
What happens if i sign the memo of transfer and send it to the conveyancer? Does this mean they have my house with out finance, or does it mean they are bound to the contract regardless of their finance?
You should seek legal advise asap. Usually finance clauses have an expiry date well before settlement. If you haven’t notified them that finance was not approved then you may be locked in to the purchase. Depending on which state you are in you may have just 14 days to settle if they issue a notice to complete. If you don’t settle in the time they can keep the 10% deposit (or sue you for it) and try to resell and sue you for any short fall if they sell it lower. So quickly see your lawyer (not conveyancer) and take some advice.
Terryw
Discover Home Loans
Ph: 02 96333 599
[email protected]https://www.propertyinvesting.com/forums/property-investing/help-needed/4329862
What about this terry?? This is from the other persons perspective…. not related to mine, but similar.
why would i need legal advice on a standard contract? Subject to finance is pretty standard. But the events that have followed, such as not notifying us that there is a problem with finance before the due date, and signing the memo of transfer before finance is arranged is not standard, and i would have thought a breach in contract to the point where perhaps their deposit is forfeit?
What is the memo of transfer? If i sign it are they in a binding contract regardless of finance? Or are they breaching the contract by signing it before they have finance?
Ok, i just opened my mail. I have from my conveyancer a “memorandum of transfer” which has been signed and witnessed by the purchasers. Its just waiting for our signatures. Its a form T1 if that means anything. Surely this is a breach of contract?
I cant understand how i can loose so much, but they dont loose anything. I have no protection but they walk away with all their money scott free.
what about the fact that they did not notify us that their finance is not approved by the cut off date? 22nd of dec? Is this a breach of contract meaning we keep their deposit and recover costs?
The also put “pre approved finance” on the offer form which was obviously false.
ive probably lost all the other interested parties by now because its been a month since signing. When does their deposit become mine? I cant understand how these people can sign, pay a deposit, then when they can get finance they can just walk away no penalty. Mean while, i have lost other potential cashed up buyers, marketing, rent possibly my deposit on another property. Seems like i have no protection against people who dont care.
damn, mods move to help needed forum
