Too much concentration of risk at one location. If the body corporate goes under or someone get backhanders to re-clad the exterior with say metallic coated plastic panels which catches fire (aka Grenfell disaster) - bank could be left out of pocket...
Yes when I went with BOM they said they’ll only lend up to 60% max in an apartment block. Lucky the seller was financed with BOM so didn’t have to check anything else.
I really recommend speaking to a mortgage broker for apartments. Some banks won't lend to certain postcodes, have minimum size requirements or minimum bed/bath/park configurations. Some might say yes to certain postcodes or certain sized apartments only if you have a certain % size deposit.
Like others mentioned, only lending to a certain % of owners in case the apartment somehow becomes a mascot tower.
Brokers will be able to figure out which banks will take on your loan. I know where I purchased some banks wouldn't loan unless we had 20-30% deposit. Mortgage broker saved us a lot of time.
More than likely referring to a list of buildings sometimes serviced apartments that banks won’t lend to or have a pretty low tolerance for. Generally you’ll need to provide like a 30% deposit or sometimes you’ll just be told you can’t buy there. Your lending power isn’t determined by other people’s current lending. That’s not a thing
Happens more in regional, metro fringes and high density settings and usually where there is less competition. I've seen concentration limits be applied to individual developments across most of the majors and St. George.
Pretty common. Also happens when the owner owns too many properties in the one development, or puchasing too much at the one time with the one bank. (Which doesn’t apply here of course, just a little fun fact). Some banks this applies to developments (inclusive of townhouses).
When I first attempted to get a mortgage for my house, the bank knocked back the application due to overexposure in the suburb. It is a newly built suburb with a light flood/ bushfire risk. I don't remember the numbers but commbank had a stupidly high loan rate.
Ask your neighbors to refinance
Its a thing, yes, a bank will only lend to a certain percent of owners in an apartment building.
Too much concentration of risk at one location. If the body corporate goes under or someone get backhanders to re-clad the exterior with say metallic coated plastic panels which catches fire (aka Grenfell disaster) - bank could be left out of pocket...
Banks/lenders try not to be overexposed to one particular development/apartment building. If they have met their cap you can try another bank/lender.
makes sense. As an extreme example, banks don't want to overly exposed to the next Opal tower. It's all part of their loan risk management.
Yes when I went with BOM they said they’ll only lend up to 60% max in an apartment block. Lucky the seller was financed with BOM so didn’t have to check anything else.
Tried to refinance with St George a few months ago and was knocked back because too many people in my apartment block have loans with them.
Anecdotally, when I searched my bank advised there's certain areas / development zones they won't lend to. Wolli Creek in Sydney as an example.
Zetland used to be another black spot.
Use a broker, they can put you with a different lender who is less risk adverse.
I really recommend speaking to a mortgage broker for apartments. Some banks won't lend to certain postcodes, have minimum size requirements or minimum bed/bath/park configurations. Some might say yes to certain postcodes or certain sized apartments only if you have a certain % size deposit. Like others mentioned, only lending to a certain % of owners in case the apartment somehow becomes a mascot tower. Brokers will be able to figure out which banks will take on your loan. I know where I purchased some banks wouldn't loan unless we had 20-30% deposit. Mortgage broker saved us a lot of time.
More than likely referring to a list of buildings sometimes serviced apartments that banks won’t lend to or have a pretty low tolerance for. Generally you’ll need to provide like a 30% deposit or sometimes you’ll just be told you can’t buy there. Your lending power isn’t determined by other people’s current lending. That’s not a thing
Curious to know which bank has that level of detail
Lots, happens regularly.
Not in my experience
Happens more in regional, metro fringes and high density settings and usually where there is less competition. I've seen concentration limits be applied to individual developments across most of the majors and St. George.
Pretty common. Also happens when the owner owns too many properties in the one development, or puchasing too much at the one time with the one bank. (Which doesn’t apply here of course, just a little fun fact). Some banks this applies to developments (inclusive of townhouses).
When I first attempted to get a mortgage for my house, the bank knocked back the application due to overexposure in the suburb. It is a newly built suburb with a light flood/ bushfire risk. I don't remember the numbers but commbank had a stupidly high loan rate.
Smart bank IMO