95% loan

whitefresh · Jul 20, 2015 9:48 pm

Does anyone know if there any lenders out there for a land loan, 95% with lenders mortgage insurance included, So I've got 5% + additional funds for stamp duty, just need lenders mortgage insurance capitalised into the loan.

Ponzu · Jul 20, 2015 10:56 pm

Yeah depending on your individual circumstances most lenders will capitalise the LMI to a max of 97% LVR. Talk to a broker.

Zarli · Jul 20, 2015 11:26 pm

I'm pretty sure westpac bank west and Cba still offer 95% loans

Joker · Jul 20, 2015 11:30 pm

I would tread carefully before basically borrowing the total value of the land.

plc · Jul 21, 2015 12:39 am

Hi Whitefresh, yes there are still some lenders out there who will lend 95% of land plus LMI up to 97%.

Just note that borrowing such a high LVR means that LMI will be costly, and you might not be able to capitalise all of it so you might need some funds out of your own pocket to complete.

What you also need to do is plan for the future construction. For example, allocating some funds to start that off with a builder to do drawings, soil test, plans, quote, etc.

Cheers

Tom

Emmz70 · Jul 22, 2015 7:53 pm

Hi WhiteFresh
We just saw our broker a couple of weeks ago. We have two lenders to choose from CBA and bank of Melbourne. Th@ option you asked is still possible but our broker doesn't recommend it, due to large LMI fees etc, The advice he gave was to try to at least get 10% deposit. You can use Land or house deposits you've already made as part of the 10% as well. Also lenders look at individual circumstances, income, liabilities, credit checks etc.
example was bank was willing to lend us 90% LVR with LMI being 17k plus, and willing to lend us 547000 on a $55000 dollar deposit, but because we still have 6 months to go before building we should have reached over 15% so our LMI will be under 10k, and of course 20% no LMI. Definitely not interested in 90% LVR. The less money to borrow from lender the better. Definitely talk to a broker, great advice from them for sure.
Good luck with purchasing your land. :-)

becjarrettdalton · Jul 23, 2015 10:47 am

There is one lender who will do 95% plus cap the full mortgage insurance - as everyone has said the mortgage insurance won't be cheap but in a rising market saving extra could mean a bigger price rise than the difference in MI. I've seen clients keep saving to avoid $6k in MI only to have land go up by $50,000 in the same time frame.