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- In Bee Savvy - Getting the most out of your loan, Getting ahead - How to improve your finances
If you have investment property/s, then having lenders calculate rental income for your next property application is essential. It is only natural that customers will not be aware how lenders calculate rental income, but this is a vital piece of the puzzle.
Why Lenders Calculate Rental Income
Whether your applying for a home loan, or another investment loan, if you currently hold a rental property, you will want to count the rent as income. All lenders will do this. But they do not all do this the same way.
Working out how much you can borrow is one of the most important steps in applying for a home or investment loan. Your wages will be counted, as well as having lenders calculate your rental income.
But just how varied can this be?
Will The Way Lenders Calculate Rental Impact Have A Big Impact?
Most lenders tend to use the 80% rule. That means they look at how much rent you receive per week, and will include 80% of that as income. But some lenders, and some properties will have a different method applied to calculate rental income.
There are some lenders that will calculate rental income at only 50 or 60% of what you actually receive. This can vary from lender to lender and can also change depending on the type of property you own, or where it is located.
Thinking of buying And Need To Include Rental Income?
Are you considering making a purchase, or even need to refinance? Rental income usage can affect how much you can borrow.
Bee Finance Savvy is here to help buyers navigate the complex world of lending, and find the home loan that’s right for them.
If you’d like an up front, no obligation consultation, why not speak to our savvy broker Desiree. Desiree is here to answer all your questions, and help you on the way to achieving your property goals.
If you’d like to hear from just some of our satisfied customers, take a look at our reviews on WOMO https://www.wordofmouth.com.au/reviews/bee-finance-savvy-miranda