All Topics / Finance / Investment Income outweighs Salary

Viewing 6 posts - 1 through 6 (of 6 total)
  • Profile photo of BrettBrett
    Participant
    @brettgarland
    Join Date: 2019
    Post Count: 3

    Hi Property Investors.

    I recently tried to refinance a loan to complete some renovations and was knocked back as my ratio of rental income exceeds my salary. We are currently getting approx 120K in rental income, portfolio is roughly $2.5  with approx 350k in loans. I would love to start looking at another property using the equity we have but don’t want to waste time applying for finance if it will get declined based on serviceability.

    NB: Loans are in personal names

    Does anyone know of a solution around this?

    Cheers Brett

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    You need to seek credit advice from a broker. Was the reason that you failed serviceability or that you were too rent reliant?

    As a guide you could generally borrow 7x your annual pretax income – very rough.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    https://terryw.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://Terryw.com.au/

    Profile photo of BrettBrett
    Participant
    @brettgarland
    Join Date: 2019
    Post Count: 3

    Hi Terry,

     

    sorry for the delay in responding. We were told it was too rent reliant. How does one get around this?

    I’d love to leave my job and become a full time property investor. But just don’t know how to proceed.

    brett

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    The first thing to do would be to try a different lender.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    https://terryw.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://Terryw.com.au/

    Profile photo of Alex480Alex480
    Participant
    @alex480
    Join Date: 2021
    Post Count: 0

    Hi, I have an advice for you about your decision. The best course of action is make your side hustle work for you and if your income on that hustle is more than what you make a year and is now a constant flow, then decide to resign from your work.

    joana davidson
    Participant
    @joana-davidson
    Join Date: 2021
    Post Count: 0
Viewing 6 posts - 1 through 6 (of 6 total)

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