I have a property in WA
loan =203K
expected equity= 100K
Salary = 850net per week
Dependant =wife and one kid
currnet rental=220goss per weekplanning to buy another one how much I can borrow?
Regards
DanHi Dan
With that amount of equity and structured correctly funding should not be an issue.
Serviceability varies from one lender to another and the difference in amount can be substantial.
You state that you are receiving a current rental so i assume that the property you own is an IP and maybe you are renting or own your PPOR outright. Obviously you will also receive rent from the new IP as well.
Rule of thumb:
1) Take your net monthly income and add
2) Between 75-100% of rental income deduct
3) All principal & interest mortgage repayments using a rate of say 2% higher than you are actually paying.
As well as any other loans and a 3% limit on any credit cards.From this figure take away a living allowance for a couple and 1 dependant and this leaves a monthly figure. Divide this amount by the principal & interest factor / 000’s using a rate of say 8.75%.
This will give you the likely amount avaialble for new borrowing.
Remember as mentioned these figures vary considerably and also the method of calculation varies but it is it least a way to start off.
Richard Taylor
Residential & Commercial Finance Broker
**Lodoc Commercial loans from 7.39%**
Licensed Financial Planner
Ph: 07 3720 1888
[email protected]Richard Taylor | Australia's leading private lender
Thanks very much. I spoke to a loan broaker today. According to him the max I can borrow is $125K on top of what I have. I’m bit puzzled here.
I did mentioned that new property may bring around $200 per week.I was eexpecting a decent amount. his calculation was based on HSBC.
any light on this please[specs]
See another broker.
Richard Taylor
Residential & Commercial Finance Broker
**Lodoc Commercial loans from 7.39%**
Licensed Financial Planner
Ph: 07 3720 1888
[email protected]Richard Taylor | Australia's leading private lender
Originally posted by danpackis:Thanks very much. I spoke to a loan broaker today. According to him the max I can borrow is $125K on top of what I have. I’m bit puzzled here.
I did mentioned that new property may bring around $200 per week.… perhaps he was assuming you were looking at buying another loss-making asset? The first house appears to be costing you around $60/week, so buying another similar house would double your cost… although given the recent price rises, it may be even more. Servicability I believe its called.
Remember, a property that will bring around $200 per week is only really worth $155k from a yield perspective. Subtract 20% deposit, and $125k sounds about right![biggrin]
Doesn’t it?[blink]
Oh, apparently not. Yield is irrellevent in this new world where house prices double every 7 to 10 years.[eh]F.[cowboy2]
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