Browse Forums Home Finance 1 Mar 06, 2015 6:38 pm We currently own a home worth about 500k and have a loan of 360K. We are looking at buying land and then building with a property value of bout $600K in total. Im wondering if anyone knows about the logistics of getting a loan which will need to cover our existing home and then our second home before we sell our first home. Is there such thing as an extended bridging loan for building? Re: Building a new home while also having a mortgage 2Mar 06, 2015 6:54 pm For us we extended our mortgage to cover land purchase and are in the process of selling our current home to fund the building on our land. If you bought $200k land the total security would be $700k. At 80% lending ratio that is a loan of $560k. So with the current $360k plus $200k = $560k that works. You just have to stretch to the repayments on $560k, but you could make a portion of that interest only to bring the repayments down until you have sold. Alternatively just sell now and rent until your build is finished. You still have to pay rent plus a progressively increasing mortgage during the building so financially similar. Re: Building a new home while also having a mortgage 3Mar 07, 2015 1:08 am Yes, there is such a thing as a bridging loan for construction purposes. However as with any bridging loan, you really need a fair amount of equity in your current property (unless you have your own excess funds to use). With the figures you're suggesting, if you haven't any of your own funds, you will struggle as the peak debt will be too high of an LVR, especially when also including costs like stamp duty, and LMI (which is calculated on peak debt). Cheers Tom Re: Building a new home while also having a mortgage 5Mar 07, 2015 11:24 am For us, we just got a second loan separately to the first. So right now, as we are about to enter into the construction phase, we are paying the first mortgage on our existing proprety plus another mortgage on the land and then over the next 6 months another loan that will get progressively bigger as we go along. We are looking to sell the current property in the next 18 months. Paddington 29 @ Blue Horizon Estate (Lot 105, Wattleridge Crescent, North Kellyville) Our Build Progress Blog: http://light487.wordpress.com/ Re: Building a new home while also having a mortgage 6Mar 10, 2015 7:48 pm Hi Lukevl, As plc stated before there are bridging loans for construction purposes however with the figures you have provide I also do also believe you will struggle if you are unable to contribute any of your own funds. The other potential option was to increase and/or refinance your current loan to a 90% lend. This will bring your new loan amount to $450,000 and leave you with this $90,000. You can then use this $90,000 to pay for the stamp duty and deposit for the vacant land and construction. We would then look at obtaining the remaining funds from the bank. Hope this helps! Re: Building a new home while also having a mortgage 7Mar 17, 2015 1:52 pm The above have already answered, we are in the same predicament. What we've ended up doing is extending on our current mortgage so we can purchase the land and at least have that secured. We had to put some $ in but our final mortgage is land plus current dollars owing on house, keeping it under 80% (lvr). We are about to put our house on the market and have already signed up with a builder so once our house sells we can apply for construction loan (bank has said we'll be approved but just cant make it official until we sell our house). We have to rent during construction but the payments will be minimal at first and slowly increase as the construction happens. Much more manageable financially for us. Good luck! Re: Building a new home while also having a mortgage 8Mar 17, 2015 1:57 pm Forgot to add that we have everything sorted with a builder so they're ready to build as soon as we say so. We don't have as high figures as you but pretty much the same circumstances and this is what made it work for us. Hope this helps! Not back peddling at all. You seem to have issues with comprehension my friend. Guy fcked up, he's considering being dishonest with his bank and hiding it. It will end… 21 12566 Hello everyone Please advice me how can I install mesh security window or we cab say mesh flyscreen inside while the pvc plantation shutters are already installed? Is… 0 7821 traditional gable roof facade - Have you did the dark and light gray color combination in facade with gray stone in facade… 0 1825 |