Browse Forums Home Finance 1 Sep 09, 2010 4:59 pm Well, we really DON'T want to go down this path, but we're looking at all options...we really have fallen in love with a property but haven't sold (or even listed) our own yet. So basically, the property we love is going to auction, but there's a chance that IF we offer say, $330-$340k, we could MAYBE get it and they wouldn't go forward with the auction. It'd save them money and us stress and the possibility of it being pushed out of our budget by eager other bidders. But we don't know if they'd accept our offer...and we can't really offer anything until we know we can PAY for it if they DO accept it!! lol If they DON'T accept it, and it goes to auction, we don't want to list our property for sale if we can't even get the place we love...around here and in this current SLOW market, it could seriously take a year to find another one we love AND that is almost perfect in terms of location, size and other practical things, and in the meantime, if we sold now, the prices could go way up by the time we ever found something we loved...thus, pricing out of the market!!! So anyway...either way, I want to know about finance options, just temporary ones so that if we DO offer and they accept, or if we successfully negotiate at auction somehow, that we can know we're ok to buy. I chatted online with someone at CBA about it before briefly, and she said I CAN'T get bridging finance because I don't have an existing home loan per se. My mum is my lender, you see, not any financial institution. So she said I'd need to just get a normal home loan but would then pay it ALL off as soon as our property sold...and there'd be fees and stuff for early termination and all that, but that's ok. My concern is that either our place just won't sell, ever. And we'll be completely screwed. This freaks me out. OR that in order to sell in any reasonable length of time, we'd be forced to drop our price SO low that we then can't cover ALL of that "bridging" loan. Has anyone had a bridging loan or some sort of special temporary finance in this case? Thank you! How the hell did I become a senior member!? I know nothing! Re: Finance options for buying before you sell 2Sep 14, 2010 7:50 pm Hi Grace, We just wrote an article on selling and buying a new home which explains the options in detail. Ummm we haven't actually proof read it yet so please excuse the woeful spelling or better yet let us know where we stuffed up! If you can answer a few quick questions I can probably work out the best way to go.
I know what you mean about finding the right house. If it comes along at the wrong time it can be a blessing and a curse! Re: Finance options for buying before you sell 3Sep 15, 2010 12:02 pm Hi, and thanks for replying!! • Our property has been valued at between $340,000 - $375,000 by 3 separate agents, but we haven’t gotten an independent (paid) valuation, nor have we put it on the market yet to gauge potential buyer feedback. For us, $340,000 means we’re screwed and $375,000 means we’re all set! Huge difference, so we really don’t know what the true value is right now • We bought it for $337,000 2 years ago (and put in new carpet, new paint, re-coloured the darkened grout, new lights, new hot water system cause the existing one leaked and died) • We currently still owe my mum a total of about $280,000 off the original loan (some of which has been paid back obviously) • There are no other loans on the property at all • I’m not sure if my mum has actual security over the property. I would assume she does. We went through all the proper formal lawyer-instructed (and expensive) channels when we bought. We had to pay the stamp duty on the “mortgage” even though it wasn’t through a bank. Since my original post here, my mum has said she can actually bank roll the new property IF it doesn’t go much over $350,000. WOW! Such a gorgeous, generous mum I have, eh? So we wouldn’t need any sort of proper finance now, except if it goes to say, $360,000, we’d have to get some sort of mini loan (not a home loan obviously though) to cover that, and the small number of renovations we’d need to do, plus the legal costs. So now it’s more a case of trying to get it straight in my mind that if we buy the new property, my mum pays for it in full…then when we sell our current property, we pay her back the money we owe her from our FIRST loan, and then we’d “start again” with the second loan…*brain muddled* How the hell did I become a senior member!? I know nothing! Re: Finance options for buying before you sell 4Sep 15, 2010 12:28 pm Wow your mum is great! Yes it sounds like your mum would have a mortgage on the property. No matter, if she can bankroll the purchase then that sounds like no problem for you. Re: Finance options for buying before you sell 5Sep 15, 2010 1:46 pm Well, technically sort of, yes. Lol. The only issue would be is if the property went too high, and then we’d be out-priced, sadly. The only other thing which stresses me out but doesn’t seem to worry my mum is if we have issues selling our own place and would then be really worried about being forced, eventually say 6 months down the track, to take a much lower price and then we couldn’t pay my mum back properly (she loaned us money for our current property too, which we’re still in the process of paying back), which I refuse to let happen. She said we could rent it out if it’s not sold by the time of settlement of the new place, and the rent she’d receive would apparently be more than what she earns from her bank term deposit right now, and she’d get tax breaks and stuff. So…yeah. We’ve just got all our fingers crossed that (1) the place we love doesn’t go up too high at auction, and (2) our own place DOES get a high price when we sell! How the hell did I become a senior member!? I know nothing! Use a product like Equisol's Vitalise to clean the deck then coat with a penetrating timber oil. It will look 10 years younger and add value to your home. Visit for… 1 15764 you were just referred to get advice from your solicitor. This is a legal matter. Separately, why would you use a buyers agent for a house and land package? 3 55064 Ardo That is so funny! I wonder how many people know who Larry Haun is these days. I have a couple of young guys we call Mo 1 & Mo 2 who run a crew of 6 boys and… 9 15483 |