How much can I get to buy a company title apartment?

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chapati
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Joined: Tue Mar 20, 2018 9:27 pm

How much can I get to buy a company title apartment?

Postby chapati » Thu Jun 14, 2018 1:42 pm

Hi Home Loan Experts,

I am interested in a property in a Melbourne suburb, which I think is a great investment. The apartment unit costs $630,000 and I know that I can afford it. The property, however, is company title and hence a turn off for me as I do not own it outright. How much can I get from the banks to purchase this apartment?

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Otto Dargan
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Re: How much can I get to buy a company title apartment?

Postby Otto Dargan » Thu Jun 14, 2018 2:59 pm

Hi chapati. Welcome to the forums.

With a company title home loan, you may be able to borrow:
  • Up to 85% of the property value if you’re a first home buyer.
  • Up to 85% of the property value if you’re investing.
  • Up to 100% of the property value plus costs if you take out a guarantor home loan.
  • Up to 60-80% of the property value if you need a low doc loan.
Some lenders may also offer competitive professional package interest rates as well as other discounts.

Lenders tend to reduce the loan amount for company title properties. This is because they may face additional administration costs and delays if they have to sell the property in case of default.

The sale process may also take longer than usual as there are fewer people who want to buy into this ownership structure.

Many modern-day company title apartment blocks have fewer restrictions than the older blocks from the 1960s. However, most Australian lenders still assess them in the same way. We know - it makes no sense!

Moreover, there are some potential complications with company title as there may be restrictive rules in the company constitution which may require you to have any new owner approved by the other owners if you are selling.

Please call us on 1300 889 743 or enquire online and find out how much you can borrow for a company title home loan.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

chapati
Posts: 12
Joined: Tue Mar 20, 2018 9:27 pm

Re: How much can I get to buy a company title apartment?

Postby chapati » Thu Jun 14, 2018 4:34 pm

OK, I can come up with a 15% deposit. Moreover, is there much difference in my borrowing power if I were to buy a strata title unit instead?

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Otto Dargan
Mortgage Specialist
Posts: 7021
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: How much can I get to buy a company title apartment?

Postby Otto Dargan » Thu Jun 14, 2018 5:57 pm

Hi chapati,

Yes, if it was a strata title property, then you could borrow up to 95% of the property value with select lenders.

This is way more than a company title unit!

Strata title is simple. Any property investor or mortgage broker will tell you that strata title properties have some advantages over company title units:
  • Strata title properties are accepted by more lenders.
  • Property values on strata titles tend to increase at a higher rate than company title properties.
  • You don't need to worry about the hassles of company titles where you need to seek a kind of approval with the shareholders of the company for buying or selling the property.
On the positive side, company title properties tend to be cheaper than strata title properties, and you can save money on them by avoiding the costs associated with strata units like insurance and administration.

Please enquire online or call one of our mortgage brokers on 1300 889 743 to discover if you qualify for a company title mortgage.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

chapati
Posts: 12
Joined: Tue Mar 20, 2018 9:27 pm

Re: How much can I get to buy a company title apartment?

Postby chapati » Thu Jun 14, 2018 7:23 pm

I’m very grateful to you for taking the time to reply to my questions. I’ll consult with a few of my professional investor friends and contact your team for a home loan.


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