Financing for Pre’63 Investment Property – 4 Important Factors Banks Look At – Pre 63s

Financing for Pre’63 Investment Property – 4 Important Factors Banks Look At – Pre 63s

1. Yield.In order to acquire financing for a pre 63 the yield is important given that the value of these properties is higher than the normally non subdivided property.  Therefore, it is important to ensure that you have your figures set out to ensure that repayments can be made and that the property has a rental yield sufficient to cover repayments.

2. The strength of the Declarations on Title.  Lenders may not delve into this but the Lender’s Solicitors will be anxious to ensure that the Declarations on Title are significantly strong and of sufficient length to confirm that no third party can challenge the number of units currently in the property and that it will be marketable should the Bank need to realise their security in the future.

3. Corporate structure – most investors acquire properties under company entities or SPVs which stands for Special Purpose Vehicles.  If you are proceeding to purchase through this entity you need to ensure that all your corporate documentation is in order, that you can evidence the anti-money laundering for the directors and secretaries of the company and that your corporate structure is straight forward and easily navigable.
   
4. Cross securing – most professional investors will cross secure their properties to release the equity held in other properties to secure the one being acquired.  If this is the case professional valuations of your current properties will be a pre-requisite for the information pack to be provided to your lender