Hey everyone,
I currently own two investment properties (they have a total of about $250k equity) and I was wondering what I could do to increase my burrowing capacity from the banks, beside the obvious like getting a higher annual income. Even though I have the equity in my house (800k+), I’m unable to burrow more money to buy investment properties due to my limited income ($120k annually). Yes, I’ve tried to refinance by getting a line of credit through the equity in my home to purchase a property but I can’t. Should I go to other lenders (beside banks), is there a specific order to go through them? I guess I’m asking if there’s a way to purchase more property without increasing my income. Sorry for the long post :) Any help would be greatly appreciated.
Thank you.
Hi There,
I am the in-house mortgage broker for property investing and I have access to over 50 different lenders. It definitely does pay to look outside the one lender as different lenders have different ways of calculating things and I have seen one lender offer $300K more based on the exact same numbers. The reason being is they factor in different assessment rates, factor in different repayments for existing home loans, factor in higher living expenses, and the list goes on.
If you would like to have a quick chat and see if there are any other lenders that may assist, please feel free to give me a call.
Also, it may be time to start looking at purchasing future properties under trusts which will assist you to increase your borrowing capacity and assist with building your portfolio further.
My email address is [email protected] and my mobile number is 0477 212 840 if you would like to have a no-obligation chat.
Christopher Berry | Find A Better Rate Home Loans
https://findabetterrate.com.au
Email Me | Phone MeTaking the Hard Work of your home loan
seek credit advice. There are over 350 ways to increase borrowing capacity – but not all will be relevant to you, but a large number would. These include things such as reduce other debt, reduce living expenses, convert bonuses into salary, extend loan terms back to 30 years, get lower rates, use different lenders, low doc loans (without lying), guarantees, ownership structure, borrowing structure, related party loans, etc etc.
Trusts themselves won’t increase borrowing capacity, but companies can, whether as trustee or in their own right. this is because the company is the borrower and not the individual.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi Chris and Terry, thank you for both of your replies. To be honest, I wasn’t expecting any replies which I why I’m replying quite late. I don’t use credit cards and have paid off my car loan so aside from my mortgage ($700 a month), I don’t have many expenses. Yup, I’ll definitely look into using other lenders but my main question would be if a company is worth it? I have a distant family friend whose annual income from his job is probably 150k but he owns like 10 properties in Glen Waverley (purchased a while ago). Obviously he is burrowing money through another entity. I looked into forming a trust but from what I gathered, it’s more about asset protection than increasing burrowing capacity. I have enough equity to purchase another property but the limit on my burrowing capacity is the problem. I wonder if it’s worth making a company for me based on your experiences? I did some research and it’s quite expensive upfront to establish and maintain so I’m a little wary. Any thoughts on this would be greatly appreciated :) Thanks again guys.
No one can can comment really. You need specific advice.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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