Example Lending Scenarios

All Banks and Institutions have varying requirements when assessing the amount they will lend on any purchase and the following two examples are provided as a guide only.

Example 1 - 50% of total costs

Purcahse price of Unit:

$400,000

Purcahse price of Rights:

$1,100,000

Stamp Duty, Legals:

$75,000         (estimate 5%)

Total:

$1,575,000

Borrowing Limit:

$787,500

Cash Required:

$787,500

Total:

$1,575,000

Example 2 - 80% of Unit cost and 55% of Rights

Total costs in line with the above - $1,575,000.

Borrowing Limit

80% of Unit:

$320,000

55% of Rights:

$605,000

Total:

$925,000

Cash Required:

$650,000

Total:

$1,575,000

• The above examples have been assessed on the basis that you will have cash as equity for your purchase.
• Most financiers will be prepared to consider other security in lieu of cash equity.
• When alternative security is offered, serviceability of borrowing amount will be the key assessment.
• Lending Ratios to 75% of total purchase price are also available with some financiers.