According to iBuyNew Founder and CEO Mark Mendel, lenders should be providing funding pre-approval to off the plan buyers that will last them right until settlement.
A recent report from CoreLogic RP Data states that settlements of off the plan properties could be put at risk as banks and lenders tighten their lending criteria due to the large amount of new apartments which will come onto the market over the course of the next 24 months.
Mendel states that if banks are willing to fund the developers, they should also fund off the plan buyers as well. It would be a win-win situation as the risk to developers would also be mitigated.
“Buyers of off-the-plan apartments should be able to go to the bank that funds the construction and take out a pre-approval that will last them until settlement. This reduces a part of the risk for the buyer as they don’t have finance risk,” Mendel said.
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