DIBS. Developer Interest Bearing Scheme?? A gimmick to sell!

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Re: DIBS. Developer Interest Bearing Scheme?? A gimmick to s

Postby Property lover » Tue Oct 23, 2012 10:48 am

I think we got to accept the fact that there is no free lunch in the world.

1. STB - the conventional way, purchaser pay interest - the price is the cheapest.
2. STB with DIBS - more expensive than option 1, dev cost in the interest.
3. BTS - either the 10:90 , or only open for sale after CCC, it is going to be the most expensive, compare apple to apple, same timing. Dev need strong financing power and they are paying high interest, u think they are going to absorb ?

BTW, if dev pay interest on purchaser's behalf (DIBS) the interest rate is much lower than their bridinging loan / term loan. So, even I am fully aware that dev will cost in the price of DIBS scheme, I am willing to pay. As long as the selling price is still reasonable. Similarly, if dev were to finance the project via their bridging loan / term loan, they will still cost in the final selling price.. They don't buy land or sell a project without feasibility study..

M2c...
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Re: DIBS. Developer Interest Bearing Scheme?? A gimmick to s

Postby centaline » Tue Oct 23, 2012 12:17 pm

Property lover wrote:I think we got to accept the fact that there is no free lunch in the world.

1. STB - the conventional way, purchaser pay interest - the price is the cheapest.
2. STB with DIBS - more expensive than option 1, dev cost in the interest.
3. BTS - either the 10:90 , or only open for sale after CCC, it is going to be the most expensive, compare apple to apple, same timing. Dev need strong financing power and they are paying high interest, u think they are going to absorb ?

BTW, if dev pay interest on purchaser's behalf (DIBS) the interest rate is much lower than their bridinging loan / term loan. So, even I am fully aware that dev will cost in the price of DIBS scheme, I am willing to pay. As long as the selling price is still reasonable. Similarly, if dev were to finance the project via their bridging loan / term loan, they will still cost in the final selling price.. They don't buy land or sell a project without feasibility study..

M2c...

ya lor, no free lunch lar. if a win-win-win for every party in a sound deal, still okay lar. still better than those risk free BTS concept then dev make all the $$, then like buying from the secondary market liao.
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Re: DIBS. Developer Interest Bearing Scheme?? A gimmick to s

Postby Edyek » Tue Oct 23, 2012 2:28 pm

STB = scare developer halfway abadon project
STB with DiBs = scare developer price too much on interest at selling price
BTS = scare buy expensive prop.

We are so hard to please la.... Kekekeke....
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Re: DIBS. Developer Interest Bearing Scheme?? A gimmick to s

Postby HIM » Tue Oct 23, 2012 3:51 pm

Property lover wrote:BTW, if dev pay interest on purchaser's behalf (DIBS) the interest rate is much lower than their bridinging loan / term loan. So, even I am fully aware that dev will cost in the price of DIBS scheme, I am willing to pay. As long as the selling price is still reasonable. Similarly, if dev were to finance the project via their bridging loan / term loan, they will still cost in the final selling price.. They don't buy land or sell a project without feasibility study..

M2c...


PL, your insight....makes sense :thumbup:
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Re: DIBS. Developer Interest Bearing Scheme?? A gimmick to s

Postby centaline » Tue Oct 23, 2012 6:52 pm

Edyek wrote:STB = scare developer halfway abadon project
STB with DiBs = scare developer price too much on interest at selling price
BTS = scare buy expensive prop.

We are so hard to please la.... Kekekeke....

edyek gor, that's why you build your own. kekeke. :D
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Re: DIBS. Developer Interest Bearing Scheme?? A gimmick to s

Postby keneeth111 » Tue Oct 23, 2012 10:51 pm

Property lover wrote:I think we got to accept the fact that there is no free lunch in the world.

1. STB - the conventional way, purchaser pay interest - the price is the cheapest.
2. STB with DIBS - more expensive than option 1, dev cost in the interest.
3. BTS - either the 10:90 , or only open for sale after CCC, it is going to be the most expensive, compare apple to apple, same timing. Dev need strong financing power and they are paying high interest, u think they are going to absorb ?

BTW, if dev pay interest on purchaser's behalf (DIBS) the interest rate is much lower than their bridinging loan / term loan. So, even I am fully aware that dev will cost in the price of DIBS scheme, I am willing to pay. As long as the selling price is still reasonable. Similarly, if dev were to finance the project via their bridging loan / term loan, they will still cost in the final selling price.. They don't buy land or sell a project without feasibility study..

M2c...


:thumbup: :thumbup: couldn't agree more.....

centaline wrote:
Edyek wrote:STB = scare developer halfway abadon project
STB with DiBs = scare developer price too much on interest at selling price
BTS = scare buy expensive prop.

We are so hard to please la.... Kekekeke....

edyek gor, that's why you build your own. kekeke. :D


:clap: :clap:
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Re: DIBS. Developer Interest Bearing Scheme?? A gimmick to s

Postby Edyek » Wed Oct 24, 2012 8:40 am

centaline wrote:
Edyek wrote:STB = scare developer halfway abadon project
STB with DiBs = scare developer price too much on interest at selling price
BTS = scare buy expensive prop.

We are so hard to please la.... Kekekeke....

edyek gor, that's why you build your own. kekeke. :D

1) later sendiri no knowledge on how to build
2) if appoint contractor build, scare kena chop 9 9 or halfway abadon project also
:lol:
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Re: DIBS. Developer Interest Bearing Scheme?? A gimmick to s

Postby MSolutionsAdvisory » Wed Feb 27, 2013 12:02 am

Agreed with Melvin.

DIBS is the key reason (beside low interest rate) that push the market price up too far too fast.
Without this scheme, many developer just can't sell (like hotcake)...

melvinchonghonloong wrote:
linkor wrote:The bank and purchaser both bear certain percentage of risk. Fair enough.

- The bank loan u 90%, they bear the 90% risk. In case the project fail & the you cannot pay back. they take the 90% risk.
- purchaser bear the risk of developer didn't pay interest on time and didn't deliver the end product. However you take MOST of the profits if the project completes and flip with profits.

Fair enough. :chinese:


I don't quite agree to
Bank bear 90% risk? If the developer burst or 'gulung tikar', the purchaser is still liable to the property. DIBS or no DIBS we are still liable. Bank will take legal action and is purchaser may have to sell everything to pay off bank or declare bankruptcy.
DIBS is to ensure that in the event of project delay.... We will not have to bare the burden of servicing the loan. DIBS is not risk free. There are some developer use their own funds initially up to 10-15% progress of project to save paying interest. But if the project goes to 80% and stop and ultimately the developer sayonara... then purchaser is liable to the amount drawn down by developer.
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