Get your fi­nances ap­proved

The Weekend Post - Real Estate - - News -

A VERY real chal­lenge that our lo­cal mar­ket is cur­rently ex­pe­ri­enc­ing is is­sues with buy­ers’ fi­nance. While we are very for­tu­nate in Aus­tralia to have a strong and se­cure bank­ing sys­tem, this does have some con­di­tions at­tached. Buy­ers now re­quire a strong de­posit and must prove a rel­a­tively high level of sav­ing his­tory in or­der to suc­cess­fully pur­chase prop­erty. With­out these con­di­tions be­ing sat­is­fied, the banks are very hes­i­tant to ap­prove some home loans. When it comes to putting a prop­erty “un­der con­tract”, sell­ers are tread­ing more cau­tiously with fi­nance clauses as this ef­fec­tively re­moves their prop­erty from the ac­tive mar­ket for weeks. To al­le­vi­ate this is­sue and put them­selves in a strong ne­go­ti­at­ing po­si­tion, buy­ers should at least have a line of “con­di­tional ap­proval” in place with a lender or through a fi­nance bro­ker and be able to pro­vide the ap­pro­pri­ate doc­u­men­ta­tion. They should no longer be sur­prised if a seller wishes to con­tinue to mar­ket their prop­erty un­til fi­nance has been un­con­di­tion­ally ap­proved in or­der to find a suit­ably qual­i­fied buyer. Sell­ers on the other hand, should re­gard an of­fer that is not con­di­tional on fi­nance, as a par­tic­u­larly strong of­fer and may need to ne­go­ti­ate the sell­ing price of their prop­erty a lit­tle less vig­or­ously in or­der to se­cure that buyer. Chris Marsh prin­ci­pal, Marsh Prop­erty

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