Browse Forums Home Finance 1 Mar 31, 2011 11:22 am Hi Respected Members of this forum, My home is under construction and should be ready within 1 month's time. I've got my 80% home loan through Bankwest, so i didnt pay any LMI on it. The loan amount is 336,000 and at the time of loan approval the property value was 420,000 which was before 4 months. I've a personal loan from CBA of about $23,000 which i am paying a high rate of interest on it of about 17%. The specific queries that i have on the above situation are as following:- 1. I am wondering if I can do debt consolidation via homeloan topup? I dont want to exceed 80% of the new valuation of the property to avoid any LMI. 2. I want to know when can i apply for my homeloan topup, should i wait till the time the final payment is done to the builder and the property is handed over to me or can i apply for a topup in between the progress payments? 3. In the event if i Bankwest is unwilling to do a homeloan topup, which lender is the best in the current situation for homeloan refinancing with competitive rate of interest, who is not charging any application fees and is also cover for my exit fees? The main concern here is to do a debt consolidation as i dont want to pay my installments of personal loan at 17%. Any word of advise or guidance is highly appreciated. Cheers, James Re: Debt Consolidation via Home loan Topup 2Mar 31, 2011 11:36 am You would be best off waiting until the home is complete and you are living in it. Valuers are notorious at not being imaginative when looking at properties being built. Your lender may also rest on the existing val - ie not wish to increase the debt at all. Some things are worth waiting for. Re: Debt Consolidation via Home loan Topup 3Mar 31, 2011 12:00 pm Thanks for your reply Kyton. What would be the reason for the lender not to allow for a homeloan topup when there is enough equity in the property? Re: Debt Consolidation via Home loan Topup 5Mar 31, 2011 1:36 pm I was going to ask for any home loan topup with Bankwest based upon their latest valuation that they will do before releasing the final payment to the builder. Correct me if i am wrong but if Bankwest's latest valuation shows if the property value has increased by for e.g. $50,000 than i can always ask or at least apply for a topup of upto 80% of it that will be around $40,000? Re: Debt Consolidation via Home loan Topup 6Mar 31, 2011 5:09 pm James_smith I was going to ask for any home loan topup with Bankwest based upon their latest valuation that they will do before releasing the final payment to the builder. Correct me if i am wrong but if Bankwest's latest valuation shows if the property value has increased by for e.g. $50,000 than i can always ask or at least apply for a topup of upto 80% of it that will be around $40,000? Hi James, Firstly when banks inspect properties during construction they are doing "progress inspections" not full valuations. This means that there is no valuation showing a higher figure as yet. Increasing a loan during construction is a very painful process and many banks simply do not allow it unless you run out of money. I would strongly recommend that you wait until construction is complete. Your property may have increased in value, however I wouldn't expect the bank valuers to agree. They are incredibly conservative. The good news is that some other lenders are now offering 85% LVR with no LMI. So if BankWest's valuation is low you could just refinance instead. If you can then ask BankWest to value the property without doing a credit check, that way if the valuation is no good you will not damage your credit score which may prevent you going elsewhere. Hope that helps Re: Debt Consolidation via Home loan Topup 7Apr 02, 2011 11:45 am Hi jb_money, Thanks for your great insight. Refinancing is an option if Bankwest doesnt want to topup the loan as it doesnt make sense for me to pay high rate personal loan which will eventually affect my serviceability. I realized that you are based in NSW. Can i seek your firm's help in refinancing even though i am based in Melbourne? Cheers, James The biggest challenge will be if you take out a loan and then run out of money - you'll have an incomplete security and lenders do not like this so you can get stuck.… 2 18897 Hi, you've probably already resolved this, however, Commbank will probably pay the funds to you after you send evidence the work is done regardless the change in the quotes. 1 35192 How much are you ahead in payments compared to where the build is at? Have you fully drawn down the loan? 5 11893 |