If you own a property that has positive cash flow as opposed to negative gearing, would the banks be more willing to lend you more money as the rent received covers the repayments? I think you’d would be perceived as a much bigger risk if negative gearing as your own income factors in to covering the repayments as rent will be lower than the repayments. If the investment loan to secure the property is the same amount (say $500k), would lenders let you borrow more for +cash-flow properties? If so, how much more approx?
Yeah I get that but will the banks view that as a $500k loan total for serviceability? $130k loan for deposit/stamp duty and $370k loan to secure the property? In that case burrowing the full amount being $500k and not putting a deposit down will have no difference on serviceability.
Do low doc loans still take into account consistent income? I’ve currently reached my borrowing cap by burrowing $650k (the full value of the property) for an IP purchase and I heard it’s possible to purchase more property through low doc loans as long as a 20% deposit is being put down. Is this possible?
There are low docs still out there, but you will need to declare an income still – and pass serviceability. If the income is too low you will still not service. You will also have to supply limited evidence of the income which might be bank statements, bas or accountant letter or a combo