What is a stratum title unit?
Stratum title, also known as stratum estate, is similar to strata title in that it is normally used as a title for units or townhouses. Each unit owner has their own lot and the common areas such as gardens and stairwells are a separate lot owned by a service company which is in turn owned by the owners of the units.
As a general rule stratum title properties are more complex to manage and are not as widely accepted by banks as security for a home loan. Stratum title is used in Victoria and Tasmania, and is quite common in suburban Melbourne.
How much can you borrow?
- First home buyer: 95% of the property value.
- Investor: 95% of the property value.
- Guarantor loans: Borrow up to 100% with select lenders only.
- Low doc: 80% of the property value.
- Discounts: Competitive professional package and basic loan discounts are available.
Stratum title has some restrictions, with many lenders refusing to accept these properties as security for a mortgage.
We have access to a few select banks that will lend up to 95%.
In particular there are only a select few lenders that can consider stratum title low doc loans.
Enquire online or call us on 1300 889 743 to talk to a mortgage broker that specialises in stratum title properties.
Why are the banks conservative?
Because of the complex nature of the legal ownership of stratum title properties, most banks tend to be hesitant to lend more than 80% of the property value. Similar to a company title property, the owners actually buy shares in a company which owns the common areas.
The bank takes a charge over the shares in the service company and also takes security over your lot. However just as with other blocks of units the owners vote on any decisions that need to be made to do with maintenance, insurance of the block and other expenses.
We have in some cases been able to finance loans for up to 95% of the property value depending on the location, size and value of the stratum title unit.
Apply for a stratum title home loan
Borrowing money for a stratum title unit is not as straight forward as for a normal apartment. By using a specialist mortgage broker you can find out who will lend you the most money and still give you a competitive home loan.
Call us on 1300 889 743 or fill in our free assessment form to find out which lenders can help.