I agree with the above however crime rate is a bit debatable. Places like Mount Druitt, Doonside and Harris Park in Sydney are examples. All 3 have very strong and good performing rental and sales markets based on yield and how quickly they rent the places out.

Ok problem is with the loan amount – some lenders such as Westpac go to 70%. You have 2 options:

1. If you need to use your current lender for any specific reason then you may need to provide a term deposit as security to mitigate the LVR or 

2. Go with a different lender that will go to 80% like NAB. NAB also has room to move on higher loan amounts where as other lenders again like Westpac run out of steam for over $1 mil loans

Hi Lilian,

There is a number of reasons why the bank with restrict your LVR. I dare say that it is due to the type of property you are purchasing or the loan amount?

Also re the sunset date – this is a date that the developer's bank will give the developer to complete the development. In other words, the developer does not have an infinite time to finish the development. Normally the developer will give you a date that he expects the development to finish and then there is the sunset/settlement date which is noted in the contract of sale. Generally speaking (if not in all cases) the sunset date is far greater than the date the developer expects to complete the development.

Hi Aloha,

You can borrow 100% of the construction costs so long as your overall LVR falls under 95%. 

Have you done developments before? I do and from personal experience I always find the need to have liquid cash due to an unexpected cost. The lender will always lend you the funds in progress payments, i.e. $15k for demolition, then $20k for slab, etc. Some lenders may have LVR restrictions on construction such as ANZ so be careful with that. Do you have the DA already as the lender will require this.

Regards

Shahin

You can borrow up to 95% however things that are not included in the building tender, lets say demolition costs and fencing to keep things simple then you will need to give quotes for these and present them as part of the loan application. These costs are generally also factored into the construction cost when the valuer values the property and more specifically the building value. Are you doing 2 dwellings on one title or are they on separate titles?

Regards

Shahin

Where abouts in the Parramatta area is this located?

Gravel and stepping stones will be cheaper but it depends on area and clientiele. Speak to a few real estate agents and see if there is a massive difference between the 2 come resale time. 

Also weed mat doesn't do much. They still grow on top of the mat after a period of time. 

There is a several lenders that offer full offset on fixed loans but you pay a premium on the rate. Why are wanting to fix your loan?

Macquarie's internet banking is one of the best in the market and light years ahead of the other lenders. Gosh I should get a job at Macquarie?

Hi Jewel,

Fixing your loan helps (by a decent margin) your serviceability with some banks including Westpac. However, interest rates are going down plus there are certain restrictions that apply with fixing your loan hence why I recommend that you should not consider fixing your loan unless its your last resort and the extra borrowing power supersedes the disadvantages that come with fixing your loan. So in short see which lender will lend you what about, look at the negative gearing component, etc.

Regards

Shahin