Hi all,
I hope my question isn’t too inept but are new to IP, we have just had an experience with a mortgage brokers that has left us even more confused.We have 1 IP, last valuation march 03 – 87K
with 61K owing.We saw a mortgage broker who advised us that an IO loan would help us, as a line of credit could pay off an existing personal loan.
This would help as we are sml bus owners and cashflow is vital.This brokers have done a valuation on existing IP that has been valued at $15000 lower than than 2 months prior.
They have offered a loan for $72000 which doesn’t give us enough to pay off loan…..Any ideas on how to use the equity…..another IP would be the best choice however it doesn’t help with cashflow.
Thanks….Confused
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Hi Wte48b
Re: valuation. If you feel that the value is not adequate then ask the broker to negotiate with the lender or perhaps consider another lender. For example, perhaps you should have been there when the valuation was done to ensure the valuer is aware of all the market evidence in the area. How about asking if the lender will accept a valuation you commission (to be used by the lender for mortgage purposes). Then you have control of the valuation process.
Getting access to equity is vital. Don’t settle for an undervaluation.
BUT be informed. Be sure that your estimate of value is realistic. You must be able to point to specific evidence.
Re: how to use equity – pay out your personal loan first. This is non-deductible debt (or bad debt as some would say). Get rid of all bad debts first… then invest. That’s my advice.
Cheers
Stu
Property & Finance News
at http://www.prosolution.com.auThanks Stu,
Our IP is country vic – we are melb. so unfortunately we were not able to be present at the time of either valuation.
My sister just purchased a unit in the same complex for 95K so we are pretty confident our unit worth as much (or at least 87K – the 1st valuation).
I think some more research will definately be on my agenda.
If anyone could recommend a reputable broker or any ideas it would be greatly appreciated.
Many Thanks
wte48b[
]Hi,
Firstly don’t blame the broker[] – he is not the valuer, who is employed by the lender. The broker wants your property valued as high as you do – he wants the money from the loan – if it doesn’t go ahead – he gets nil.
We have just successfully challenged a valuation of our ppor – which we knew was way under – by asking local real estate agents for recent comparable sales. Ask your broker to get some idea of what properties/values were used to compare – this is harder for you long distance, but not impossible. Then []present the proof in written form, showing date of sale and $ value, and location in respect to your property. We just increased our val by $25k – it is still under reality, but it is enough for us at this point.
If you decide to get another val paid for by yourselves, then you must ask for it to be done for use of the lender – and you’ll probably have to pay a bit extra to get that – about $50. Make sure you talk to the valuer personally, and let him know about the other sales and their value – don’t rely on him to have good info – they often compare weatherboard with brick, and not in a similar position – your mind would boggle at some of the val’s comparisons that we have seen (as mortgage brokers), with sales from 2 -3 months ago not being included.[!][]
Basically, don’t give up!!!!!!!!1Hi Hilary,
thanks for your advise.
Of course you are correct in that the broker is not responsible for the valuation…I guess the frustration creeps when false deadlines are “promised”, then to have a hickup…you tend to vent questions and seek answers from the “front” man, ie. the broker.
many thanks
[]ps what sort of time frame is reasonable is signing application….to signing mortgage papers..2, 4, 6, 8 weeks???
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] – he is not the valuer, who is employed by the lender. The broker wants your property valued as high as you do – he wants the money from the loan – if it doesn’t go ahead – he gets nil.
]present the proof in written form, showing date of sale and $ value, and location in respect to your property. We just increased our val by $25k – it is still under reality, but it is enough for us at this point.The topic ‘IP and equity …New and Need Help!’ is closed to new replies.
