traceyimbParticipant@traceyimbJoin Date: 2003Post Count: 82
A bit of information for people who may be having problems with getting finance. I find the biggest problem I come across is two or three or more credit cards, sometimes $15000 – 20000 or more. Here are a few tips that most of you probably already know – but some may not.
1. Credit cards – lenders calculate your borrowing capacity on the credit limit not the outstanding balance. Lower your limit to the absolute minimum you need. If you have more than one card – ask yourself why? When the lender sends you a letter to increase the limit – tear it up.
2. Personal/car loans – these loans really eat into your borrowing capacity. Pay them off as quickly as possible.
3. Interest free finance – Do you really need that lounge/stereo/computer on interest free finance? This is really just another credit card which must be taken into account.
4. Restructure your loans – get some advice. Are you getting the most for your money? Could you be paying less in interest and fees?
Never go to just one lender – call a local mortgage broker, they will come and see you and discuss your future investment plans and the finance you need to achieve them. Check with them on the phone that they offer a free service. Ask other investors for a good contact. If you are unhappy with the service you get – change, find someone else.
Good luck with your investing!
Tracey Imbuldeniya – Finance Consultant
Mortgage Masters Financial Services Pty Ltd
191-193 Stirling Hwy, Nedlands WA 6009
Funny that this should be the first topic I came across this morning.
I just got a call from my mortgage broker, who is a mate of mine, who told me that my borrowing capacity on my next property would be max $190k. I have no credit cards, 8,000 in the bank, a loan of 170,000 on a unit now worth 225,000. I earnt 42,000 last finacial year with modest pay rises to come in september and 4% next january. I have no other debts.
I wanted to buy a house for less then 250,000 and wrap it so that the rent from my first unit and the spread on the new property cover my loans and I ould travel for a year.
The only thing the banks seem to care about is that I earn 42,000 a year and have a 170,000 loan. Max borrowing 190,000 for next property. Don’t argue. What does anyone suggest I do about this?! I am just baout to cancell the inspections I had lined up for today due to the shit house news I got this morning.
Wild Nothing.Stuart WemyssMember@stuart-wemyssJoin Date: 2003Post Count: 598
How do I prove to a bank or lender that my rental yeild on a wrap will be higher then my loan repayments? Are banks receptive to wraps?TerrywParticipant@terrywJoin Date: 2001Post Count: 16,173
The trouble is, banks do not like you onselling something htey have a mortgage over via an installment contract.
Also banks will generally only go on what they consider market rent. This is generally calculated about 5% of the purchase price per year. You can argue that you will be getting more, but have to have some good reasons.
However, for future borrowings, once you settle on the property they will assess it at whatever rent you are actually getting.
[email protected]dynamicduoMember@dynamicduoJoin Date: 2002Post Count: 21
Hi Wild nothing,Only $190K lend you say?Why not further your search for both lenders and property.$190k would secure you a whole lot of cashflow +ve property where I’ve recently purchased.Good luck
“a true warrior sees misfortune as challenge-not as a curse.”IshitaMember@ishitaJoin Date: 2003Post Count: 20
I agree with furthering the search on finance. Like I read in a book somewhere, just because one institution knocks you back, don’t be discouraged. Move on to another and then another
Are you using a broker?
IshIshitaMember@ishitaJoin Date: 2003Post Count: 20
Yes you are using a broker…sorry. I’d still widen the search though…
Ishvluu27Member@vluu27Join Date: 2003Post Count: 59
It’s all about rental yeild. If you buy a higher yield property your capacity will increase.
This will be addressed in my “unlimited finance” article – which I’m about half way through.
When can we expect to read about your article. Cant wait. 
Vinhhwd007Member@hwd007Join Date: 2002Post Count: 247
Stu when will your masterpiece be complete ? re; unlimited finance article ?Stuart WemyssMember@stuart-wemyssJoin Date: 2003Post Count: 598
I have finished it. It’s going through the editing stage. I hope to have it ready in the next couple of weeks.
Please manage your expectations… you start to worry me when you use words like “masterpiece”. Please, keep expectations low. That way they are easy to exceed.
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For those of you who said that I should widen my search, you are right. I am now starting to look around the net at different towns, most that I haven’t heard of, but I realise that 190k is still enough to do soemthing with. I was just cut that I couldn’t borrow what I wanted. Anyway, I have stopped sticking out my bottom lip, woken up to myself and am looking at other options. My goal somehow changed from making my now negativly geared loan a positivly geard one, to borrowing $250k. Thanks all for the advice.
And of course I wouldn’t expect tiffany purvis-white to tell me where they bought +ve geared property. Would be nice though
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