Do you want to subdivide land with a mortgage but unsure if you can?
In this video, Colin Fragar, our founder and CEO, discusses subdivision with a mortgage.
Click on the “Play” button below to watch now:
Or for those that prefer to read, here is a transcript of the video…
So a question I often get asked is can you subdivide land with a mortgage? My name is Colin Fragar from Council Approval Group.
So if you are thinking about doing a subdivision, congratulations. Now you’re probably worried, thinking, ‘Oh, I’ve got a mortgage, will the bank agree to it or not?’
So can you subdivide land with a mortgage? The answer is yes, but only with consent.
What Banks Want to See
So if there is a mortgage, then they’ll have a covenant on the title. And that means that for any land dealings that they do need to sign off on it. What the bank will be looking at is to see whether or not their debt position will be covered. And usually with a subdivision, the good news is you’re adding massive value. So nine times out of 10, the the bank will not have an issue with that.
The issue usually comes up when you try to sell one of them and then they’ll probably be looking to see, do you have enough income to service the debt and just because you had a mortgage from 10 years ago, 20 years ago or two years ago, they’ll usually be looking at your current financial position to see if you can release effectively one of the titles.
So can you subdivide land with a mortgage? Absolutely, yes. And let us help you to guide you through it.
What’s Your Next Step?
If you have a property in mind, make sure you grab Your Ultimate Guide To Council Approval. There are a bunch of tips and tricks in here. But also, if you are at this point, which you probably are now, we recommend you book in for an appointment to talk to one of our team. This is for those people who are serious, who want to take the next step in organizing a subdivision, whichever step along the way you are. Maybe you’ve got a property already and you need to lodge a development application. Maybe you’re a little bit further along than that. Or maybe you’re just exploring your options and you are investigating purchasing a property.
Please book in for a consultation at councilapproval.com.au where you’ll be able to select an appointment time of your choosing. My name is Colin Fragar from Council Approval Group. Thanks for watching.