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- In Bee Savvy - Getting the most out of your loan, Building wealth - Finance for investors, First things first - Steps before applying for finance
Many clients come to us, wishing to purchase an investment property. This may be for their first property, or their second, or even more.
How lenders assess how much you can borrow
When we look at how much you can borrow for an investment property, we look at calculations used across various lenders.
When working out your borrowing capacity, we look at things such as income and expenses, expected rental income, ongoing mortgage or rental repayments, and in some cases, nominal rent must be used by the lender, even if you are living at home rent free.
All of these items can vary greatly from lender to lender. So it is important to have an upfront assessment of your situation to help gather the best options for you.
Where do I get my deposit from?
This will depend on your current financial situation. Have you been saving away for many months? Do you have equity in existing properties? Will you be receiving a gift from relatives?
All of these factors will also determine which lender is best suited for your circumstances. Some lenders have strict rules on giving cash out, even though its your own equity and you may be more than able to afford this. Others have rules for or against deposits that are gifts from relatives.
If you are looking at applying for an investment loan in the near future, get in touch with Bee Finance Savvy. Our broker Desiree is here to help you work out what you can do to make your deposit and income and expenses more acceptable to lenders. A few simple changes can help drastically improve your chances of approval.
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