Case Study | Residual Stock – Hampton, VIC

Case Study | Residual Stock – Hampton, VIC

DFP secured a Residual Stock loan for equity cash out, $600k at a 65% LVR, with a new valuation completed and settled in under 3 weeks.

Project Background

DFP was engaged by the borrower to obtain a first mortgage residual stock facility to provide cash equity out of a single residual apartment in a previous development completed by the group. The client has recently commenced a new project and wanted to use the equity in the apartment to start project early works. 

The borrower notified DFP to arrange immediate cash-out finance as they wanted to commence the new project immediately.

Key Challenges

The developer was seeking immediate cash-out to commence the new project immediately in line with the development timeframes for delivery.

The Solution

First mortgage residual stock facility 

DFP arranged a 12-month facility for $600k at an LVR of 65% approved with a new valuation completed and settled in under 3 weeks with the existing residual stock apartment as security.  

The Result

DFP delivered:

• Finance secured: Terms approved March 24, with a valuation completed and settlement completed April 14.
• Loan Amount $600k , Valuation ‘As Is’ $925k = LVR 65%
• Term – 12 months, 3-month minimum term

The client was very happy that they  were able to obtain cash out to commence their new project, while still keeping the stock apartment on the market with only a three-month minimum term on the facility.