If you can get a real estate investment loan even if you don't have much of your own funds, it's almost always with collateral.By covering the loan amount with collateral, you can see the possibility of receiving a loan of an amount that you could not originally receive.Interest rates are lower than unsecured loans, and the repayment period can be set longer, so there is also the advantage of reducing the monthly repayment amount.This time, I would like to explain the collateral evaluation in real estate loans.
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When you need collateral for a real estate loan
The down payment to be prepared for real estate investment is 3% of the property price. 6000 million yen is about 2000 million yen.However, you may not be able to pay the down payment due to circumstances such as wanting to use leverage as much as possible and wanting to keep cash for emergencies.In such a case, there is a means to obtain a loan using the real estate that you already own as collateral.
How to get a real estate secured loan
- Application for provisional examination to a financial institution
Apply at the window of the financial institution or on the website, and receive a brief explanation about the hearing and financing. - Interview with the person in charge, final application
Prepare the necessary documents, go to the window of the financial institution and have an interview with the person in charge.Documents to bring are mainly identity verification documents, seal certificate, tax payment certificate, property tax payment form, income certificate, real estate register certificate, loan balance certificate, commercial register copy, financial statements, business plan, etc. And prepare these without omission. - Examination
We will investigate the applicant's credit information and investigate the real estate you want to finance.In many cases, it takes about XNUMX to XNUMX weeks because we go to the actual property and investigate it, not just looking at personal attributes. - contract, financing
If you receive a loan, you will sign a contract at the counter of the financial institution.In that case, you will need a registered seal, seal certificate, stamp fee, etc., so please check with the financial institution.
How is the loan amount determined?
How the loan amount is determined by collateral evaluation
I introduced a series of flows, but how exactly is the loan amount determined?Basically, it is determined by “personal attributes x collateral evaluation (assessment value of property)” and “value of real estate to be financed”.The collateral valuation is calculated by multiplying the bank's appraisal value by about 7% (ratio of appraising the collateral lower than the appraisal value), so basically it will be lower than the market price.Of course, the higher the collateral valuation, the easier it is to get a loan.If the repayment is delayed, the financial institution can dispose of it by auction etc. and collect it.
The value of the property to be financed is also important, and both the land and the building are subject to evaluation.
There are four standards for land (land value) (Ministry of Land, Infrastructure, Transport and Tourism official land value, prefectural standard land value, National Tax Agency roadway value, municipal fixed asset tax assessment value), but financial institutions use them for evaluation in real estate secured loans. It seems that there are many roadside prices of the National Tax Agency, which is also the land price for inheritance tax calculation.Road prices are rated about 2% lower than others, and we are taking a strict look at the loan collection in case of emergency.For a building, first calculate the replacement price (the amount required for a new construction or purchase), and then calculate the total floor area and legal service life.However, it should be noted that the price of the building will be 0 if it exceeds the statutory useful life, so only the land value will be evaluated.
Financial institutions focus on personal creditworthiness
Personal attributes (creditworthiness) are also important.Personal information such as occupation (scale of work, length of service, title), annual income, savings, debt status, past repayment status, family structure, etc.Age is also important, and one of the items that is emphasized is how old you will be when you pay off.The more you borrow from other financial institutions, the harder it will be to pass.
If the collateral valuation is low, will the loan not be issued?
In the case of a proper loan, the possibility is not XNUMX
As long as the above is what the financial institution evaluates, is there absolutely no loan if this is not satisfied?Speaking of which, it's not.
Financing may be available depending on individual circumstances.And as a tendency, it can be said that the possibility is higher for a proper loan than for an apartment loan.Since the apartment loan is a package type, it is screened based on clear criteria, and if it does not meet it, that's it.In the case of a proper loan, each project is independently screened, so if the attributes are very good and the creditworthiness is considered to be high, the loan may be granted exceptionally.However, it can be said that it is strict in a sense from the viewpoint that even the qualities as a manager are examined.
Summary
- The collateral appraisal value is determined by "individual attributes x collateral appraisal (property appraisal value)" and "value of real estate to be financed".
- Personal creditworthiness (scale of work, length of service, position, annual income, savings, debt status, past repayment status, family composition, etc.) is also important.
- When the collateral appraisal value is low, there is a non-zero possibility of receiving a loan due to good attributes.
At Rich Road Co., Ltd., we will consistently support all aspects of investment real estate, from complete beginners to experienced people, from a wide range of real estate selection, loan consultations, post-purchase management, and renovations.
