One of my friends has just appproached his Bank to finance a new PPOR down in Perth and was all set to have his IP valued (by a licensed Valuer) and was informed that that was not necessary as long as he had the local REA value it!
The Bank is ANZ and their reason is that the value from the REA will, more often than not, reflect the Market value and the valuers valuation generally comes within 2 to 5 % of the REA’s valuation.
Has any-one else heard this come accross it?
He had the house valued any way, just to make sure (REA: $220K, Valuer $125K [weird] ) but the bank was happy to accept the REA’s value for the loan.
Fact or roumor?? Any-one……
Cheers
C@34Our greatest weakness lies in giving up. The most certain way to succeed is to always try something one more time.
– Thomas EdisonDon’t let reality be the benchmark for your Dreams Think Westpac used Roy Weston or one of the PERTH REA groups when we re-structured..IMO most valutions can be at least 10% of the Mark (remembering Banks err on the side of caution)
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow CalculatorHi Redwing,
I have no actual proof – just the surprised word of my friend.
He bought his IP two yrs ago and wanted to take advantage of the recent boom to buy a PPOR for himself and his new bride-2-b.
Our valuation came in at $220K, but in talking to one of the local REAs it was suggested that I could get up to $320K (OK, the garden wasn’t finished at the valuation). If true, that is a massive difference!
What do our MBs know???? Fact or Fiction???[blink]
Cheers
C@34Our greatest weakness lies in giving up. The most certain way to succeed is to always try something one more time.
– Thomas EdisonDon’t let reality be the benchmark for your Dreams
C@34,
Yep, I’ve never had a valuation done on new purchases of IP’s. As all my IP’s are interstate, I’m simply required to sign an “Out of Region Form”. Which basically says that yes I’m aware of the possibility of 2 tier marketing interstate, but I’ve done my homework.
Stamp – Loan Approved.Mal
Getting out of your comfort zone, can help you become comfortable
I am overseas at the moment in a cafe, so cannot check, but it does sound strange. ANZ usually insist on a registered valuer from their panel, doing the valuation – usually a drive by. Possibly the local agent is also the panel valuer.
Terryw
Discover Home Loans
Parramatta
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Sounds strange to me also… Maybe the loan was approved by a branch manager under their own delegation of authority. I am sure that standard policy is to use a panel valuer but maybe this guy just cut corners. I doubt banks will start accepting valuations form real estate agents. Who knows?
Cheers
Stu
Friend of mine also uses ANZ. When he wants to refinance he just gets an appraisal letter from the local REA and ANZ are happy to use that as the valuation.
He gets a few letters and uses the highest one!!
He always works below 80%, it obviously wouldnt work if a MI was involved.I would be interested to know if its ANZ policy or just something this local branch is doing? Or if any other lenders will accept a REA appraisal.
Grant
I suspect ANZ may have used the contract of sale instead of a valuation. Cheers.
Regards
Steven
Mortgage BrokerMobile Mortgage Market
Ph: 0402 483 216
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http://www.mobilemortgagemarket.com.auPLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.
Hi Steve,
No the IP is not on the market (as yet)! He is planning on holding it for another couple of months (FMG is ramping up construction in our area) and then sell it for a higher price again.
Interesting ….. it is a country location, if that helps but we do have a valuer that services this town. Like I said originally, it is a new thing so maybe it hasn’t filtered out everywhere AND it may be Loan dependant. As in up to a certain loan volume???
Don’t know, I’m just asking the question.[blink]
Cheers
C@34Our greatest weakness lies in giving up. The most certain way to succeed is to always try something one more time.
– Thomas EdisonDon’t let reality be the benchmark for your Dreams
A lot of the ANZ managers do their own valutions for ppty in country towns. He probably used the letter from the agent to help him ‘determine’ what the value was.
Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe†in subject line.Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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