Hello Duran. Welcome to the forums.
Untitled land or unregistered land
is simply land that is sold prior to council registration usually offered by property developers and is typical of new estates or new land releases. When you put down a deposit which is usually 10%, you’re entering into an off the plan purchase wherein, the developer promises to deliver a block of land before a specified date.
You can apply for a pre-approval
to buy untitled land based on the assessment of your borrowing power. However, before a bank can give you an unconditional mortgage approval
for vacant land they first need to order a land valuation. And the valuer can only value the land once it’s registered.
After the developer informs you that the land is ready to be titled, if you’ve already gotten a pre-approval at this point then the lender will order a valuation of the land
, pending which they will provide you with unconditional approval. So, you’d want to wait until you’re less than 3 months away from the settlement to apply for a home loan as pre-approvals only last for 3 to 6 months.
Lenders have different policies on the type of properties they accept as security. They have post code restrictions that limit the LVR (loan to value ratio) you can borrow.
You should hire a solicitor or conveyancer to go over the Contract of Sale and to help you transfer the land title from the developer to you at settlement.
Give us a call on 1300 889 743
or fill in our free assessment form
to find out if you qualify for a vacant land loan.