Browse Forums Home Finance 1 Jun 24, 2015 8:21 pm Hi all, My current situation, I have no cash deposit and in the near future I will be gifted land from my parents (we are aware of the CGT). The land has been evaluated and valued by a real estate agent to be worth $200,000. My plan is to build a home on the gifted land and also to be my place of residence. My question is, if its possible to use land as a 30% deposit to obtain a construction loan from a lender to build and to also avoid LMI. Thank you Re: Can I use land as a deposit for a construction loan? 2Jun 24, 2015 8:39 pm Any equity in your land is used when determining loan/valuation ratios but you'll need a formal valuation done by a licensed valuer (and not a real estate agent's 'valuation', they're not worth the paper they're written on!) . Other lending criteria will also apply as well. What a great gift though Re: Can I use land as a deposit for a construction loan? 3Jun 24, 2015 9:01 pm Thank you for your reply. I'm very fortunate to have great parents. I will definitely get a licensed valuer to come out and evaluate the land, thanks for the advice. Good to know this is possible without a cash deposit. Re: Can I use land as a deposit for a construction loan? 4Jun 24, 2015 9:10 pm I wouldn't bother paying a valuer. It shouldn't be that hard to work out what's its "worth" for your purposes and then when you go for your loan the bank will value it again anyway. Re: Can I use land as a deposit for a construction loan? 5Jun 24, 2015 9:33 pm As above, yes you absolutely can when its in your name - and the lender will require their own valuer to look at it when you apply for the construction loan. Sit back and let it be done for you! Lucky you! Rebecca Jarrett-Dalton Property crazy expert mortgage broker, love building new homes! Two Red Shoes mortgage broker http://www.tworedshoes.com.au/building Re: Can I use land as a deposit for a construction loan? 6Jun 26, 2015 2:54 am Yes, as others have said, you can use the equity in the land going forward on the construction loan. Note that there will be stamp duty to pay on market value even though the land is being gifted to you. Cheers Tom 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 Plasterboard Gyprock is very popular as a reveal liner these days. You need to provide a way of supporting it, we use a modified timber reveal or bracket. You will be… 1 3010 Depends what you're current inclusions are, but we're not including wardrobes and will just use second hand ones until we can save later on to get them built. Also have a… 3 11596 |