There are distinct advantages to purchasing property off-plan from a developer, as the developer has invariably had to comply with strict criteria laid down by the banks in order to obtain finance.
If you decide to buy a new home or investment property off-plan, the great benefit to you as the purchaser, is that you are assured of a quality product that has been built in accordance with all current approved laws and practices.Most developers acquire finance from a bank in order to fund their development and begin selling off-plan. The banks are very selective as to whom they will lend to, and about the type of developments they are prepared to approve loans for. As a result, a lot of research is done by the bank on the geographic area, the actual end product, the professional team and the developer's track record.
The strict criteria generally used by the banks in approving a loan for a new development are as follows:
All this information is given to the bank for assessment and consideration. Although a bank may be happy with the product, it may choose not to overexpose itself within a single development and opt instead to cap the percentage of end-user mortgage bonds. In other words, one bank may advise the developer that it will only accept 60% of the total bonds in a development.
Advantages to Buying Off-Plan
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