White Ants saved us Money $$
What brought you to Louise?
We wanted to see how much we could borrow to buy our next property – a family home, as we both own an apartment each (well, the bank and us do!)
What were your options?
Originally we were thinking of selling one of our apartments and use the equity in that to buy but we saw the market hotting up again and thought it might we worth trying to do this sooner rather than later so we decided to go down the equity release option to assist with our deposit
What did that involve?
We had a valuation done on one of our properties hoping to release equity with that current lender. That didn’t work so we ended up doing a whole refi with another lender to release equity.
I believe the timing got tight as you were seeing properties you were interested in buying?
Yes, we were and places were starting to go way over the range quoted and we became very keen to buy. However, we were hitting roadblocks because my partner has a ¼ interest in a commercial property (with his father and his father’s super fund) with a relatively small LVR but apparently some lenders were assessing it based on the fact he may be liable for the whole debt. The amount of questions and paperwork we had to provide was hideous! We both have good jobs, good credit history etc but it was proving to be more difficult than expected.
It was funny though, we were well aware of the changes in the way lenders were looking at discretionary spending and as we had had 6 months of weddings (5 to be exact) we were worried about how our unusual spending patterns would be considered by lenders, but no questions were asked – it seems the interest in the commercial property was the main concern!
Side note from Louise: Lenders don’t like dealing with partial debts between different family members and often will count the entire debt against the borrower but only attribute a quarter of the rent! (as in the above example)
So what was the outcome?
In the end, we ended up doing refi/equity release and pre-approval to buy a new property with the same lender so at least the documentation was relevant to both loan applications.
So you have bought a home?
Yes, we have. Another interesting experience. As I mentioned prices were going through the roof again so we missed out at a couple of auctions. We had been interested in another place but had seen it under offer twice and then back on the market. My partner enquired and found out one contract had fallen over because of finance the other because of a Building and Pest inspection. We found out that there were white ants in the place that the vendor knew about but decided not to deal with them. Anyway, we put in an offer believing the vendor may consider a reduction in the price (plus my partner is a tradie so he got advice about the white ants and what it would cost to fix, etc). So knowing that it would cost approximately $2,800 to remedy the pest issue, we were able to get the property for a pretty good price in the end and have money left over to fix a few things!
While we wouldn’t ever recommend buying a property with white ants, the bottom line is they are not uncommon in Melbourne and at least we knew about them and were able to rectify the problem. The pest inspector told us that since the timber railway sleepers have been replaced in this area, houses were seeing more pest issues. Highly recommend you get a building a pest inspection and at least you can make an informed decision!
We love our new home and despite a few hurdles along the way, we have learned a lot and excited about living 500 m from the beach 🙂
If you would like to discuss your circumstances, please do not hesitate to contact me on 0412 709 200 or book a time to chat with me via calendly.com/louise
With thanks,
