Does anyone out there have experiences with purchasing a Devine home with no deposit required, as an investment property? Good or bad, I’d like to hear it.
I am researching, and reading in publications that say use someone elses money instead of your own.
My fiance and I are wanting to obtain an investment property in the near future and I am curious to know if the devine offer is a good idea.[
]Hi Skater
I haven’t had expereince with Devine but from their ads you get the gist that they are charging a higher than normal interest rate of just over 7.5% for finance (with a comparison rate of over 8%). (I am not 100% sure of those rates but can recall they are close to that). This seems high in terms of what you can get from the banks but it depends on what you want to achieve.
Always read the fine print.[
]Josie
Hi Skater,
I’ve only heard bad things about Devine Homes.
I’ve had a couple of people tell me that when they went to find out more about it, apparently what happens is that you pay no upfront fees but as soon as they start building, you pay these weekly repayments which do not get deducted from your “mortgage”. All that money that you pay when the house is being built is apparently to cover all the fees. The day they finish building the house is the day the fees that you pay on a weekly basis gets deducted from the cost of the building. So i think people are being tricked into thinking the weekly repayments made during the building is taken off the cost of the building however thats not the case.
I have not had dealings with them myself so i don’t know how true all this is or even if it would affect the situation of an investor.
Hope this has helped in some way.
Regards,
Kim
Skater
I would love to know more if you plan on seeing them could you give us an overview, as I have wondered how this might work for me.
Cheers
Leigh K[]Carve your own path and lead the way …
Generally, how they work (home builders offering no deposit).
Up until recently, every home loan lender required a deposit from every customer, whether it be 3 or 5%. So what happens is, that these builders/homes put that 3 or 5% in for you.
So, somehow, they have got to get it back. Whether it’s higher interst rate or payments while building.
If you are considering a loan where it is 100% of the purchase price, why don’t you contact broker.
They have access to 100% home loans by St george and Pepper Home loans, there are other 100% home loans also on the market, however they are not truely 100%.With St george and Pepper you can use your FHOG to cover costs or $5000 approx or you need 2.5% geniune savings to cover costs.
Pepper , however does not do construction loans, but St george does. So with these loans you can choose any property, not just the ones offered by the builders themselves.
Some good brokers besides myself; Mortgage Hunter, TerryW, Stuart and Melanie
Send some details and we’ll see what your borrowing power is.
I believe that like vendor finance on wrap terms most builders offering no deposit finance actually mean you can use your FHOG instead of personal savings as a deposit.
This would mean that unlike a home owner, you would not qualify for the FHOG as an investor and would either not meet the builders qualifications or be required to put in money of your own.
Cheers, Leigh
“If you can count your money, you don’t have a billion dollars”
J. Paul GettySkater
Devine have arrangements with both St George Bank (used to be Beneficial Bank until SGB took them over) and a the old Ipswich & West Moreton B/Soc whereby the lender would advance the full 100% of the P/P plus stamp duty etc.
DH in turns provides the Bank with a Bank Guarantee (You will note this if you have a look at their most recent P & L A/c as they are a listed IPO) to cover the difference between 100% and 90%. There is no LMI.
The scheme is available to any large developer and we looked at offering to our clients but as Picja mentioned why when you can obtain a product from St George or Pepper direct.
The other thing you have to bear in mind is the quality of work that Devine produce. David Davine lives in Laurel Ave, Chelmer (on the Brisbane River) and i don’t think he lives in a Devine Home.
Cheers Richard
[email protected]
http://www.fhog.com.auThere is no such thing as a problem.
Just a solution waiting to be foundRichard Taylor | Australia's leading private lender
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