Browse Forums Home Finance 1 Aug 29, 2013 4:36 pm Can someone please explain... I sat down with the bank today, we want to buy a block @ $130K @ 5%. I assumed we'd need maybe $8K deposit not $13,837!!!!!!! Please see the link of what they came up with... http://s1020.photobucket.com/user/jonnnno/media/lending_required_zps5940103a.jpg.html Any input would be appreciated!!!!! Re: NEED HELP!! 2Aug 29, 2013 4:42 pm It looks like they are giving you a 93.8% loan + LMI not a 95% loan plus LMI $130,000 x 95% = $123,500. Whereas they have given you $122,000 loan plus $2,983 in LMI, for a final loan of $124,983. When buying a property you should allow approx 4.5% of the purchase price in costs, plus the deposit you need (5% in your case). So yes $14k sounds about right. You can go with another bank that will lend 95% + LMI. Some banks can give you a small unsecured loan for the shortfall or you can go for a guarantor loan. Hope that helps. Re: NEED HELP!! 5Aug 29, 2013 5:44 pm Transfer / registration are government costs. I'm not sure if the bank explained that this time it wasn't them robbing you When you go for construction there is a quirk with the LMI... so actually you are in for another surprise. The calculations are complex and hard to explain. But I will try my best. Land $130,000 Land loan: $124,983 Cost of construction $240,000 Total value: $370,000 (land plus construction) 93.8% loan: $347,060 (your bank isn't actually lending 95%) Funds required at construction stage: $17,923 approx (Construction cost minus (total loan minus land loan)). Note that if you are receiving a first home owners grant then you will need less at construction. You must put your funds in up front before the bank puts in their money for construction. FYI LMI can be ignored for this funds to complete calculation as it is added to the loan. Re: NEED HELP!! 6Aug 30, 2013 12:38 am Hi Joh, It seems that your lender is limited to a LVR + LMI cap of 97%, hence why they are adjusting the figures to make your base loan less than a normal 95% LVR. Unfortunately with a purchase you need to take your closing costs such as stamp duty, etc into account as they normally come out of your pocket as in most circumstances lenders won't fund it. Hence why you need a larger amount of funds than just your standard "deposit" you are allocating. With construction you will find that builders will want some sort of deposit to begin preliminary work. This should count towards the overall construction deposit. In regards to your situation, you might be able to cut some of the costs like the loan establishment fee dependent on the lender you go with. Cheers Tom Hi there, I'm a conplete newbie to this, but I'm looking to put a floor down in my 6x9m shed. It's currently sitting on a 100mm thick concrete perimeter (dirt floor… 0 4450 Hi VK, I am now retired however I have stood beside over 300 owner builders in the past 18 years that have successfully built their own homes. First of all a building… 10 18974 Thank you @. Tried to play with the facade models but the exact colour is not matching up. 2 1033 |