Carln

Other lenders have alternatives to LMI which may prove cheaper and allow you to go to 90%.

TWIMI

Dont worry about the time difference i just got off the phone from a client in the UK so now all about time difference.

Your Bank will need to consent to any subdivision and will want their legal department to run over it.

Remember once the subdivision has been approved you may not get separate Title to the property (Many Councils require the construction to have been complete before they agree to this)  and even if you do again CBA will want to approve this and will need to show that their mortgage subject to valuation is registered on both securities.

Who mentioned financial strangalation ………

I got also got it and appropriately deleted it.

Or indeed most

Being from Qld i can't comment on the areas but if it is anything like some of the cheaper suburbs in Brisbane these have the been ones that have risen in percentage terms better than some of the higher prices properties on what is considered a better suburb.

At the prices and rents you have mentioned the properties appear to be neutral or even positvely geared even at 100% gearing.

Why not look at borrowing 100% of the purchase price of each and acquire 2 of these as they will just about be self funding.

Morning TWIMI

Firstly welcome to the forum and I hope you enjoy your time with us.

CBA Colonial are like most lenders where the opportunity arises they will jump in feet first and cross collateralise every loan going. All sounds good when you sit down for coffee in the local managers mini office and he or she tells you the virtues of using them as a lender. Somehow they just seem to forget the bit about how we have you tied up for ever and woo betied you if you ever try and leave us.

Your situation is like so many clients i have seen before where now the Bank calls the tune and you like the fable state merely follow behind.

The initial property IP 1 is a fixed rate loan and therefore given the current rate of interest and potential break fee would not suggest you mess with this. In saying the security we can use to free up some additional equity on IP and allow the Bank to have this standalone.

IP 2 is a different matter and being variable would mean that you could look to refinance this and free up your equity.

Subdividing the security is one thing but you need to check that the local council will actually allow you to obtain a separate Title as this is the bit that will enable us to gear against to construct the new security.

Whilst a Gross Realisation loan would be achievable on a commercial development whilst the security is residential we will be limited to construction costs. No real drama given the increased land value and overall security.

Obviously there are a couple of other bits of information missing from your scenario but all in all doesnt seem like an unsummoutable problem.

As i say under a 60% LVR there should be no problem anyway.

Funded the odd RH which had been purchased by a specialist firm who were contracted to provide such services but as Terry mentioned doing yourself forget it.

Better investments out there.

Cazz

I hope the Bendigo didnt just do a credit search after your telephone conversation but indeed got you to make a full written application and all signed  Privacy Act Authority.

I am sure the previous Banks did a search on all 3 parties however it just depends on how Veda process the enquiry.

As mentioned you should get your mother in law to order a copy of her Credit Report so that you will now once and for all. 

You could always sell it into a Trust with you as the Trustee.

Stamp Duty would be payable but subject to the LVR could be deducted from the loan.

You wont get more than 80% lodoc at the moment.