Browse Forums Home Finance Re: SIGH - we can't get finance. Ever. 4Sep 25, 2010 9:53 am How the hell did I become a senior member!? I know nothing! Re: SIGH - we can't get finance. Ever. 6Sep 25, 2010 1:05 pm How the hell did I become a senior member!? I know nothing! Re: SIGH - we can't get finance. Ever. 7Sep 25, 2010 1:06 pm I just thought of something...what if the lender meant when they said they need to discharge the existing mortgage to my mum, that they DIDN'T mean they'd take it and add it to the new loan we require..what if they meant we had to somehow just pay it all off!!?? Could that be the case? How the hell did I become a senior member!? I know nothing! Re: SIGH - we can't get finance. Ever. 8Sep 25, 2010 4:09 pm Goodness gracious me!!! My mum has now said we can bid up to a certain price and then we'll only need to borrow from the lender the amount we still owe to her...so they'd have the only mortgage on our current property, and SHE will buy the new property and then when we sell our place, we pay the lenders back the money we owe on it, and then we continue on as normal with the loan through my mum, but for the new place. WOW. We've been on a roller coaster for weeks with this!! It'll all be over (hopefully) tomorrow...either way... How the hell did I become a senior member!? I know nothing! Re: SIGH - we can't get finance. Ever. 9Sep 25, 2010 7:25 pm Does your Mum already own her own home? If so, she will be up for capital gains tax if you ever sell the new purchase. Unless she moves into it for a period of time when first purchased and claims it as her own home (but then she can't sell her other home CGT free). Otherwise, you can transfer the title from your Mum to yourself, but you will be up for another lot of stamp duty and legals. The way you want to structure it is very messy. You best off separating your financials with your Mum. My advice would be to find a "great" mortgage broker and take their advice as to what you can and can't do, and get a good financial structure in place. Your current broker doesn't seem to have a clue, most don't. Good luck Re: SIGH - we can't get finance. Ever. 10Sep 25, 2010 7:42 pm When you say separate the financials from my mum...what do you mean exactly? In terms of her and capital gains tax, well...she owns her own home (with my dad) in Melbourne. She paid for our current place, and that's the loan we're currently paying off to her. So what's the difference if she pays for the new place too, and again we then pay her off? She's never been on the title for our current place. It's just my partner and I as tenants in common. She never mentioned anything about paying capital gains tax if we ever sold THAT, so what's the difference with the new place? How the hell did I become a senior member!? I know nothing! Re: SIGH - we can't get finance. Ever. 11Sep 25, 2010 9:16 pm Hi Grace, The bank would not likely want a second mortgage (after your mum) on your existing property. So they would want you to "transfer" it to them so that if they were forced to sell they could sell both properties and use the equity to recoup their cash. So basically by taking the loan from your mum you are effectively transferring the loan from one lender (your mum) to a new lender (your bank). In this case, the new lender would pay out the old lender. What the bank is trying to avoid is the new home value falling below the loan they have given you. on the numbers you provided it appears you would be borrowing more than 100% which is why the bank wants a second security to protect them (i.e. your current home). You are also very likely to be paying Lenders mortgage insurance which protects the bank further if you default. So if you re-borrow from your mum in due course, then you can pay down your old loan and pay your mum the lower interest rate. However, remember in any case, you will be paying a mortgage of around 315,000 for your current home and approximately 360,000 for your new home. It doesnt really make a difference you finances your current home (i.e. your mum or the bank) in terms of the total loan value you need to service. The only benefit of your mum providing funding is the lower interest rate, low fees (i.e. presumably none) and the ability to not need to press 1 then 2 then 4 then 6 then squawk like a chicken, then be transferred to india to talk to the right person when you call her. You need to be able to pay the interest on the approx 725k to buy the new home. Remember though that the rent of the current home will help pay the mortgage and can have tax benefits if your partner is a high income earner. Your salary unfortunatley wont have a huge amount of tax benefits attached. hope this helps. P.s. are you using a broker? If so, go and give him/her a very big slap as they should be explaining this to you in extremely fine detail. In fact, in WA I believe it is now law that the lenders ensure you can service the loan to prevent the high level of mortgage stress we are seeing now. Re: SIGH - we can't get finance. Ever. 12Sep 25, 2010 9:23 pm grace_slick When you say separate the financials from my mum...what do you mean exactly? If you have your mum on the title etc then she cant simply transfer it to you in due course without you paying stamp duty etc as mentioned in the other post. This can easily be tens of thousands so it needs to be considered. Also if you have issues with your mum etc things can be murky as she owns the home not you (via the bank). Hopefully would never happen, but something to consider. grace_slick In terms of her and capital gains tax, well...she owns her own home (with my dad) in Melbourne. She paid for our current place, and that's the loan we're currently paying off to her. So what's the difference if she pays for the new place too, and again we then pay her off? She's never been on the title for our current place. It's just my partner and I as tenants in common. She never mentioned anything about paying capital gains tax if we ever sold THAT, so what's the difference with the new place? It really depends on if she is purchasing the property under her name, or you are purchasing it with your mum simply providing finance. If she is purchasing under her name, when you "buy" it from her (or she transfers the title to you) she will pay capital gains on the property and you will pay stamp duty etc. However if she is simply the "bank" in the transaction, then this doesnt apply. Definitely kick your current broker. Re: SIGH - we can't get finance. Ever. 13Sep 25, 2010 11:11 pm Sorry, I misunderstood you. I thought your Mum was going to be on the title of your new place, as you said she was going to buy the new place for you. So you really me she is going to provide the funds for youto buy the new place, right? If your mother has the funds to purchase outright, then you should have no problems. I wouldn't bother with the banks if your Mum is ok and a little flexible with it. The terms should be alot easier for you if you ever get into a bit of struggle kepping up repayments. I'm sure she would understand your situation alot more than the banks would and know you are trying to sell your existing place so you can pay her off. If your Mum has the funding and is willing to help you, then you are in a strong position. Good luck Re: SIGH - we can't get finance. Ever. 14Sep 26, 2010 3:29 pm Meh. Was passed in at $360,000 vendor bid after an opening bid of $300,000, one other bid of $320,000 and that's it. Our max price is $320,000. Blown out of the water I'm afraid. *sigh* How the hell did I become a senior member!? I know nothing! you were just referred to get advice from your solicitor. This is a legal matter. Separately, why would you use a buyers agent for a house and land package? 3 58661 Depends how much direct sun it gets. Is there any shading (eaves or trees)? If the sun hits a window directly it doesn't matter too much if it's double or single… 1 12786 9 25034 |