Hi Ben

As Terry says, Tony Cordato is the man:
Cordato Partners
Level 5
49 York Street
Sydney 2000 (near Wynyard Station)
Ph (02) 8297 5600

The following may also be worth a read:
https://vendorfinanceinstitute.com.au/should-all-home-buyers-get-national-credit-code-protection/

Cheers, Paul

Hi Ethan

The following may help:
https://vendorfinanceinstitute.com.au/should-all-home-buyers-get-national-credit-code-protection/

In short, I believe that, if all home buyers using traditional home loan finance get the protection of the National Credit Code, then all consumer, residential home buyers should get this protection, no matter what sort of finance they’re using. Unfortunately Lease/Options don’t provide that protection.

Cheers, Paul

Hi Robert

A couple of links that will help to get you going with Vendor Financing are:
http://www.vendorfinancelawyer.com.au/ and
https://vendorfinanceinstitute.com.au/category/blog/

It’s worth noting that a number of consumer groups and other “powers that be” are pushing to get Rent To Buys (Lease/Options) banned in the consumer/residential real estate marketplace at the moment. In my opinion, if they don’t manage to get them banned, they are likely to be successful in forcing them to be “regulated” under the National Credit Code (NCC).

The other popular method of vendor financing in the residential marketplace, the Instalment (Terms) Contract, is already regulated by the NCC.

Cheers, Paul

Di Daniel

First up, may I suggest you have a look at a page on our website, entitled ACL Coverage; CLICK HERE

Then give me a call, as there may be a way of structuring the transaction so you are not the credit provider. It is worth remembering that , if someone is simply disposing of an asset, e.g. one property, they may not be seen as providing credit ‘in the course of a business’ and therefore not need an ACL to provide credit in this situation.

Of course, if you are giving ‘credit assistance’ to a potential buyer then you will need ACL coverage to ‘engage in credit activities other than as a credit provider’. ACL coverage for this authority can be provided by Credit Rep status.

As always, get independent legal advice on this.

Cheers, Paul

Hi Steve

Terry’s recommendation is spot on, i.e. Lewis O’Brien is, in my opinion, the ‘go to’ vendor finance solicitor in Vic.

However be very careful of Victorian state legislation regarding Lease/Options and Stamp Duty. Unlike most other States of Australia, Stamp Duty in Victoria is not normally payable until Title transfer occurs. In most other States Stamp duty is payable within a specified number of days after exchange of contracts.

A couple of years ago Victoria alone introduced legislation that makes Stamp Duty immediately payable upon the establishment of a Lease AND an Option on a property.

This has resulted in Lease/Options being generally dropped by Vic based vendor financiers and vendor finance (VF) Instalment Contracts becoming the preferred VF technique for Vic properties. This is because, with and Instalment Contract on a Vic property, Stamp Duty is not payable until the VF buyer sells the property or refinances it and becomes the Title holder.

Another thing to remember is that VF sales, unlike traditional sales, need ongoing administration after the buyers move in. I’d suggest you Google for a ‘vendor finance management’ company.

Cheers, Paul

Hi weathjess

I like the ideas here regarding the retention of this property. As a number of people have mentioned, there does seem to be an opportunity to do something with the hospital.

However if that doesn’t work out, you may get some ideas regarding a long distance ‘negative2positive’ vendor finance sale at CLICK HERE.

Cheers, Paul

Hi JBC

Knowing Jason personally and knowing how long he’s been in the industry I’d suggest you take his advice to heart ;-)

Back in 2003 when we started in Vendor Finance (VF), marking up a property by 20% over market price was the standard. How things have changed! Our standard way of pricing a VF sale these days is to do an auto-valuation on RP Data. The valuation then comes up with a low estimate, a high estimate and a mid point they call the estimated price. We now use the high estimate as our VF sell price. It’s a price we believe the various courts and tribunals you can end up in, won’t see as excessive. Don’t forget these institutions are ‘all about’ the consumer, as a purchase like this is possibly the biggest purchase your consumer may ever make.

On another issue, we are now keeping away from Lease/Options (Rent To Buy’s) big time. Being a member of the FBAA’s (Finance Brokers Association of Australia), Vendor Finance Steering Committee, I am seeing just how various regulatory authorities (Fair Trading Dept’s), consumer groups and other important stake holders have really taken aim at residential Lease/Options. For example, have a read of the following article showing how the Financial Ombudsman Service are now involved in the over-sight of Lease/Options. CLICK HERE for the article. A recent VCAT ruling in Vic regarding a L/O cost the VF’er $45,000 and these types of rulings aren’t isolated (see the cases in WA).

As vendor finance Instalment Contracts are regulated by the NCCP and seem to be quite acceptable to ‘the authorities’ we’re sticking with them. With this major push against L/O’s we have now given them away in our VF business. Your call of course.

Cheers, Paul

Hi Jimmy

Hopefully the following link to a media release from the FBAA (Finance Brokers Association of Australia) can help to start to clear up the ‘shady’ image: CLICK HERE to view the media release regarding Vendor finance.

Cheers, Paul