After reading the Saturday’s Gazette story about Apollo Developments, I was wondering who would buy any of these places for the $200,000 to $250,000 Andy Banack says they will sell for?
A quick search of the MLS listings will reveal 35 condos in St. Albert for under $250,000 all of which are equal to or better than any of these Apollo units. What can Apollo offer that these other places can't? I'll tell you what — the 20 per cent second mortgage financing scheme.
Say you have a buyer that can't get a mortgage for a $180,000 condo, but if they buy the Apollo unit for $225,000 with the 20 per cent non-payable second mortgage, they pay $180,000. If they have five per cent down they will only be applying for a mortgage for 75 per cent of the Apollo unit's value.
There are banks out there that will give mortgages to almost anyone if you have 25 per cent down. I know we got our first mortgage with me as the sole income earner as a commission salesperson with only four months experience because we had 25 per cent down. This is similar to the trick we used when I worked at the car dealership to get marginal buyers financed. If someone is trying to buy a $35,000 vehicle with nothing down, they need pretty good credit to get financed. However, with some working of the numbers if that same car is now worth $40,000, but they are given $5,000 down, that looks a lot better to the bank. The car dealers say they are “helping people get a car that otherwise couldn't.” Some might say they are taking advantage of people with limited options. I guess it all depends on your point of view, doesn't it?
Randy Hughes, St. Albert
