Hi folks,
Firstly, apologies if this is a repeat question (I searched the forums, but haven't found a thread discussing this topic specifically).
My question is regarding bank rules regarding PPOR:
Is it true that if (most?) banks agree to lend 95% of the property value, they require that the buyer use the property as a PPOR (i.e. reside in the property he/she buys)?
The implication of this is that if the borrowing is 90% or less, the property can be bought as an IP.
If this is true, what do the laws/rules say? I have a pre-approval from a bank that explicitly (verbally only, through the customer service personnel) forbids buying a property as an IP because I can only come up with a deposit of 5% at the moment.
Please shed some light.
Thanks in advance.
Bank loan rules regarding PPOR
Firstly, apologies if this is a repeat question (I searched the forums, but haven't found a thread discussing this topic specifically).
My question is regarding bank rules regarding PPOR:
Is it true that if (most?) banks agree to lend 95% of the property value, they require that the buyer use the property as a PPOR (i.e. reside in the property he/she buys)?
The implication of this is that if the borrowing is 90% or less, the property can be bought as an IP.
If this is true, what do the laws/rules say? I have a pre-approval from a bank that explicitly (verbally only, through the customer service personnel) forbids buying a property as an IP because I can only come up with a deposit of 5% at the moment.
Please shed some light.
Thanks in advance.
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