Example: An apartment buyer shops around for a home loan
Brian has just signed a contract to buy a 2-bedroom apartment in inner-city Melbourne. He has a 20% deposit saved. He also has pre-approval with his bank.
But when he applies for a loan the bank says he'll need a 30% deposit. Why? Because there are lots of 2-bedroom apartments in his postcode and the bank's worried it is over-exposed to this type of property.
Brian can't come up with a 30% deposit on top of stamp duty and everything else. Instead, he enquires with an online lender. Before applying he emails the lender and is put in touch with someone from the credit assessment team. They assure Brian that there's no issue with his address or postcode, and a 20% deposit is fine.
He applies, is approved, and buys his apartment.
Are there any lenders that now finance properties under 40sqm?
Hi David,
Thanks for your question.
Although most lenders require at least 45 or 50 square metres of floor space, there are still lenders who finance smaller apartments. Unfortunately, we do not have them in our panel of lenders.
If you’re looking for financing, it would be best to enlist the services of mortgage brokers who can help you find suitable lenders.
Cheers,
Liezl