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+--- Thread: Have you ever pulled out of buying due to LIM? (/showthread.php?tid=597)
Have you ever pulled out of buying due to LIM? - kiwi - 07-11-2021
Hi
I made an offer subject to LIM, builder's report, finance and sale of my existing houses.
So while I was making calls arranging other things on my lunch breaks I put LIM application on the back burner. Now that a week has passed and I get around to the LIM I see it takes 10 working days for them to process the information. But I had to fulfill that condition withing 15 days.
So how important is a LIM? Just to make sure the building(s) on site match the LIM? Or are there other things I should be looking for?
Just to make things more stressful, when the agent was signing me up for the sale of my properties she said I should check with my accountant to make sure I won't have to pay tax on the sale of the rental. I've owned the house I live in for 20 years. I've owned the rental since about Sep 2016. I'm not gst registered. I have not heard from my accountant and could not get through to IRD. (Who could get through to IRD on a half hour break?)
RE: Have you ever pulled out of buying due to LIM? - Oh_hunnihunni - 07-11-2021
Yes. Twice. Once the check revealed an issue with a flood plain designation that would have made insurance an issue, and the second time we discovered neighbours plans to alter their property that would have impacted privacy and sun.
RE: Have you ever pulled out of buying due to LIM? - kiwi - 07-11-2021
Thanks for your useful post.
RE: Have you ever pulled out of buying due to LIM? - Oh_hunnihunni - 07-11-2021
I don't know how things are done these days, but it used to be possible to call into council property services and view the property file yourself, on site. If you are short of time, that might be an option.
RE: Have you ever pulled out of buying due to LIM? - sarahk - 07-11-2021
People do pull out based on the LIM but they also specify that problems in the LIM are rectified prior to settlement or they negotiate a new price based on defects identified.
Failing to get a LIM is how people end up with factories next door, subsidence issues, and other problems. Your lawyer should insist on you having one before you go unconditional.
As for the rental, there are specific requirements regarding depreciation, the bright-line test etc and you'll definitely want to get your lawyer and accountant to weigh in on what you need to do. To add to your problems you are probably going to want to see the house as vacant possession losing some of your income. The rules around terminating tenancies have changed significantly and nobody should ever "inherit" a tenant. Talk to Tenancy Services if you are unsure of your rights.
While phoning the IRD can seem like the right thing to do I prefer email. We once got stung $15k for not doing the right paperwork but because we'd requested it in writing and the reply was in writing it was clearly their error and they had to waive the fine.
RE: Have you ever pulled out of buying due to LIM? - kiwi - 07-11-2021
I'm still waiting for a reply from IRD.