Boarding House refinance

[fatboy4]

Looking at refinancing the mortgage over our boarding house.

We may have a few hurdles perhaps one of the forum's finance gurus can help with.

1. NAB did a 80% (Val 730k) "residential" mortgage- we are now told it has to be commercial (there are seven rooms). Hence $1000 valuation, lower LVR 70%

2. I own it in partnership with my brother. We will need a lo-doc loan.

3. NAB drive by val was only 800k. I have been reading the Heron Todd White monthly reports and they suggest the land in the area is $1100/m2 (it's almost 800m2).

CG in Paddington (Brisbane) has been at least 15% this year. (It is in a prime part of Paddo.) The 730 val was two years ago.

A BH around the corner sold for $2.2M this year. I think ours is worth $1M

Anyone know of any lenders who might be interested?

Thanks

FB

 

[Qlds007]

Depending on the whether the property is zoned as a boarding house or a large property with numerous rooms will determine the LVR.

Certainly you would not get more than 80% LVR but even as a Commercial loan a 80% LVR should still be possible.

I have a BH in New Farm and have a 80% LVR on it and it is valued well over $1Mil.

Just need to approach it from a different direction.

 

[Twitch]

Looking at refinancing the mortgage over our boarding house.

We may have a few hurdles perhaps one of the forum's finance gurus can help with.

1. NAB did a 80% (Val 730k) "residential" mortgage- we are now told it has to be commercial (there are seven rooms). Hence $1000 valuation, lower LVR 70%

2. I own it in partnership with my brother. We will need a lo-doc loan.

3. NAB drive by val was only 800k. I have been reading the Heron Todd White monthly reports and they suggest the land in the area is $1100/m2 (it's almost 800m2).

CG in Paddington (Brisbane) has been at least 15% this year. (It is in a prime part of Paddo.) The 730 val was two years ago.

A BH around the corner sold for $2.2M this year. I think ours is worth $1M

Anyone know of any lenders who might be interested?

Thanks

FB

Out of interest, what is your gross rent for the property?

 

[soyabean]

Because it is a boarding house (commercial) I think NAB values it based on the % return. If it has more than 7 rooms hence more rent $$ then they may value it higher. One of ours has only $300 ish land value (by council) but NAB valuation is high coz it has a lot of rooms.

 

[fatboy4]

Thanks Qlds007 - It's on Res A land but 6 rooms or more and it is seen by BCC as a BH. I'll contact you re the different approach

 

[fatboy4]

Rent is 900pw atm Twitch

 

[fatboy4]

soyabean- I would be interested to know if valuers go for the cap rate on BH's and how they adjust this for potential and position. No doubt they look at market value as well.

*Just a correction in my original post- the property around the corner looks like it is 4 flats not BH

 

[Twitch]

Thanks. I'm curious because I have a 6 room place returning ~$820pw. FWIW I think you may be a tad optimistic looking to value it on 4.7% (900*52/1,000,000).

 

[dantheman]

Challenger Commercial Low Doc could be an option. However - only up to 75%. Depends on the valuation they get... or you could put up more money if you want to refi badly.

 

[soyabean]

soyabean- I would be interested to know if valuers go for the cap rate on BH's and how they adjust this for potential and position. No doubt they look at market value as well.

*Just a correction in my original post- the property around the corner looks like it is 4 flats not BH

It is a licensed BH. When the income was about 80K /yr valuation was only 750K (still less than if valued by a realestate agent). Have not revalued-refinanced since then.

 

[soyabean]

soyabean- I would be interested to know if valuers go for the cap rate on BH's and how they adjust this for potential and position. No doubt they look at market value as well.

*Just a correction in my original post- the property around the corner looks like it is 4 flats not BH

It is a licensed BH - income 80K/year, valuation 750K . This was 4 yrs ago have not reval-refin since then. Don't think valuers adjusted for potental/position but have a feeling bank did consider it informally ! We got residential rate but the 70% LVR still applied.

 

[fatboy4]

It is a licensed BH - income 80K/year, valuation 750K . This was 4 yrs ago have not reval-refin since then. Don't think valuers adjusted for potental/position but have a feeling bank did consider it informally ! We got residential rate but the 70% LVR still applied.

Thanks soyabean. We may got the residential rate and an 80% LVR.

 

[fatboy4]

Thanks. I'm curious because I have a 6 room place returning ~$820pw. FWIW I think you may be a tad optimistic looking to value it on 4.7% (900*52/1,000,000).

Always optimistic Twitch

I think it's an old jewish proverb something like "If enough men tell you you're sick, lie down" Not ready to turn down the sheets just yet...

Curious about the unimproved land value of your BH