Hi, can anyone answer my question - If a property on the market was asking 185K and the RV was $210, you had a MV completed and it come in at $210. Your offer was accepted at 185K - what do the banks see? Do they see you have gained 25K equity or do they take the 'purchase price' of 185k. From recent experience I know that kiwi bank take the purchase price. What I'm trying to learn is how to buy at discount to allow me to buy again.
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Originally posted by KyronGosse View PostYeah 3 months is the general rule unless you add value to the property in which case it can be revalued almost instantly because the banks deem it a different property from the one you purchased.
Banks rarely finance on anythign else besides purchase price, just because you have a RV as well which is higher doesnt mean they will use it.
And just because you did a reno and get a new RV, doesnt mean you can recycle straight away earlier, banks may require more time.
Its case by case really.
Best way to do it, if you have funds, is buy it yourself, do a quick cosmetic reno, take that to the bank.
If your doing your job right the bank should then be giving you more money than the house + reno cost.
Traditionally, the way to do it.
Is use 20% deposit from your own funds to buy a house, other bank lends 80%.
Reno and get a new RV in 3 months or 6 months.
This bank lends 80% of new RV to you, with the extra cash called a top up loan, and you open a R/c account for those funds.
You use the funds in that new R/C account as 20% on next house.
With 80% on next house, coming from a different bank, dont cross colat anything.
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From an RBNZ perspective which is financial and banking stability then the answer would be no, it is not the wrong thing to do.
If it delays the next OCR rise by 6 months that will benefit a number of sectors also.
From the perspective of first home buyers some think it may not have such a dramatic effect.
Bank CEO says limiting banks' low equity home loans is currently the right answer to tackle overheating Auckland housing
www.interest.co.nz/property/65237/bank-ceo-says-limiting-banks-low-equity-home-loans-currently-right-answer-tackle-over
As far as the supply problems, that is up to the politicians and councilors.
Mr Wheeler's concern is the supply of higher risk credit, not the supply of land and houses.
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