Off the Plan Financing and Loan

Fast and reliable home loans for property buyers

There’s nothing like the feeling of a brand new home! We’ve helped hundreds of clients with purchasing off the plan properties, whether they be first home buyers or experienced property investors. We know the steps inside out to settling an off the plan property, which banks have more favourable policies and can lend you more, and how to successfully manage valuation risk in a slower market.

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Helping you Smoothly settle your Off The Plan Property

What is an off the plan property?

An off the plan property is one that has been sold before it has been completed, often before construction has started. In an off the plan sale, the seller is a developer and the purchaser will be the first owner of the new property.

What is the process for purchasing an off the plan property?

The process for purchasing an off the plan property is similar to purchasing a new property. Please read our FINANCE MADE EASY loan steps to learn more.
The main difference is that the purchase date is usually made very far in advance – 2 years or more before completion of the property.

This means that purchasers often exchange contracts first and then wait close to settlement to assess their position and apply for finance. Even though the settlement is many months or years away, we would encourage you to assess your scenario first for the ability to borrow, before exchanging contracts.

How far out from settlement should I apply for finance?

We recommend applying for your loan approval 2 – 4 months out from settlement. If you are uncertain of your ability to obtain finance, and you have already exchanged contracts, you should talk to us as soon as possible even if the settlement is a long way away.

When can my off the plan property be valued and inspected?

Valuation inspections will usually be held once the properties have finished construction and all the fixtures and finishings have been applied to your property. This is typically 4 weeks out from settlement date.

What Loan to Value Ratio (LVR) can I borrow at for an off the plan property?

If your off the plan property is a unit and you are purchasing as an investment property at the time of writing many banks are restricting the maximum LVR to 80% and in some instances 70%. If the property will be purchased as a home, then it is possible to purchase at 80 – 90% LVR, however Lenders Mortgage Insurance (LMI) may be incurred.

How do I manage valuation risk?

We can manage valuation risk by applying for your loan early enough that we have the opportunity to order more than one valuation and adjust our strategy as required. Valuers will have different views and different dates to determine the property value. Although the valuer is independent and cannot be handpicked, each bank uses different valuers and we find a range appears when we order different valuations.