Increase your chances of a loan approval
With credit tightening for property investors for well over a year now, making a strong case in your loan applications has never been more important. To make a strong case in your loan application, there are a few things you can do. Here's our list of what you can do to make the strongest case possible and increase your chances of a loan approval.
Do your research and shop around
Make sure you research rates through traditional banking channels and mortgage brokers to find the best rate possible for your financial situation. Remember securing a loan isn't always about the interest rate. With credit tightening for property investors, your Loan to Value Ratio (LVR) will be crucial in determining your interest rate. To calculate your interest rate, the lender will divide the amount of the loan you require by the value of the property. Naturally, the greater the LVR, the higher the risk you represent to lenders. This will change the array of loan products available to you.
Pay down personal debt ASAP
To improve your credit rating and overall financial position, paying down personal debt should be your first priority. For property investors needing finance, this is particularly important. This is because paying down personal debt frees up your income which puts you in a stronger position to service your property finance.
Decrease and closely monitor discretionary spending
It has been widely covered that lenders are now looking at applicants' discretionary spending habits as part of the loan application process. For at least a few months before you submit a loan application, aim to decrease your discretionary spending on things such as restaurant meals, Uber Eats, clothing, consumer products, and other discretionary lifestyle expenses.
Obviously, you don't want to sacrifice enjoying yourself in this process, so if you can't go without your weekly Uber Eats night, you could also demonstrate that you budget for lifestyle expenses by setting a specific amount aside each month and not going over it.
Refinance a current loan
If you've had a Principal Place of Residence loan for at least 5 years, you may be able to refinance your current balance over a new 30-year period. This will reduce your repayments, freeing up more of your income to service a loan on a new investment property.
While it can be discouraging to get knocked back for a loan, remember it's not an uncommon occurrence in the current credit market. Being proactive about strengthening your financial position, budgeting and putting yourself in the shoes of lenders and brokers will help you make sure you present yourself as a desirable loan applicant.
December
06 Dec 2019 | Things to do around home these holidays
01 Dec 2019 | Mount Hutton Property Management
November
29 Nov 2019 | Buying Property with a Friend
25 Nov 2019 | Tips Every Renter Needs to Know
22 Nov 2019 | Morisset Property Management
20 Nov 2019 | Consumer Confidence is at a Four-Year Low
16 Nov 2019 | Co-Living is Providing New Living Spaces
09 Nov 2019 | Minmi Property Management
05 Nov 2019 | 0% Interest Rates and Start QE
01 Nov 2019 | Merewether Heights Property Management
October
30 Oct 2019 | Splitting Rent & Expenses with Housemates
23 Oct 2019 | Merewether Property Management
17 Oct 2019 | Mayfield West Property Management
15 Oct 2019 | Rental Market Best Affordability in 11 Years
11 Oct 2019 | Strengthen your Investment Strategy
08 Oct 2019 | 5 Steps to Get Your Rental Bond Back in Full
04 Oct 2019 | Mayfield East Property Management
02 Oct 2019 | 3 Key Steps for Property Investing Success
September
26 Sep 2019 | Mayfield Property Management
23 Sep 2019 | Is Australia headed for a 0% cash rate?
18 Sep 2019 | Maryville Property Management
16 Sep 2019 | House or apartment? Which is better?
11 Sep 2019 | Maryland Property Management
09 Sep 2019 | Top Tips for Spring Cleaning your Home
05 Sep 2019 | Lambton Property Management
03 Sep 2019 | Fragile Conditions in Construction Sector
August
30 Aug 2019 | Winter reading for the savvy investor
26 Aug 2019 | Kotara South Property Management
24 Aug 2019 | Freshen up your space in winter
20 Aug 2019 | Power of buying in good school catchments
18 Aug 2019 | Kotara Property Management
14 Aug 2019 | How to dress up a drab bathroom
12 Aug 2019 | The Junction Property Management
09 Aug 2019 | Another month, another rate cut
07 Aug 2019 | Jesmond Property Management
July
30 Jul 2019 | Islington Property Management
25 Jul 2019 | The Federal Election is over, now what?
19 Jul 2019 | The Hill Property Management
18 Jul 2019 | Multipurpose items for your home
15 Jul 2019 | Hexham Property Management
12 Jul 2019 | How to make tax time go smoothly
08 Jul 2019 | Hamilton South Property Management
06 Jul 2019 | 4 things when searching for a rental
04 Jul 2019 | ATO cracking down on deductions
02 Jul 2019 | Hamilton North Property Management
June
30 Jun 2019 | The case for renting over buying
24 Jun 2019 | Hamilton East Property Management
20 Jun 2019 | New home approvals declined in 2019
17 Jun 2019 | Hamilton Property Management
15 Jun 2019 | Turn your place into a cosy winter home
11 Jun 2019 | Georgetown Property Management
08 Jun 2019 | Regional Areas Value Declines
06 Jun 2019 | Time Spent On Property Research
03 Jun 2019 | Fletcher Property Management
May
29 May 2019 | Conversations with potential housemates
27 May 2019 | Elermore Vale Property Management
25 May 2019 | Lending to households has increased
22 May 2019 | Cooks Hill Property Management
20 May 2019 | Create more storage space in your home
13 May 2019 | 3 finance hacks investors should know
10 May 2019 | Carrington Property Management
06 May 2019 | Broadmeadow Property Management
03 May 2019 | Is it worth buying a budget property
01 May 2019 | Black Hill Property Management
April
29 Apr 2019 | Rental Vacancy Rates
23 Apr 2019 | Birmingham Gardens Property Management
17 Apr 2019 | Beresfield Property Management
16 Apr 2019 | Off Market Property Sales
11 Apr 2019 | Strong Rental Applications
08 Apr 2019 | Bar Beach Property Management
05 Apr 2019 | Increase your chances of a loan approval
03 Apr 2019 | Adamstown Heights Property Management
01 Apr 2019 | Moving into a share house
March
28 Mar 2019 | Adamstown Property Management
25 Mar 2019 | Banking Royal Commission
18 Mar 2019 | Newcastle Property Management
15 Mar 2019 | Proposed negative gearing policy
12 Mar 2019 | Seahampton Property Management
08 Mar 2019 | Gross rental yields are at a 2½ year high
04 Mar 2019 | Edgeworth Property Management
February
25 Feb 2019 | The importance of negotiation skills
20 Feb 2019 | Barnsley Property Management
14 Feb 2019 | Property market in 2019
07 Feb 2019 | Warners Bay Real Estate
January
31 Jan 2019 | Split your household bills
23 Jan 2019 | West Wallsend Real Estate
18 Jan 2019 | Fixtures and fittings in your property
17 Jan 2019 | Toronto Real Estate
11 Jan 2019 | Australian house prices in 2019
08 Jan 2019 | Speers Point Real Estate
December
18 Dec 2018 | Rathmines Real Estate
11 Dec 2018 | Killingworth Real Estate
06 Dec 2018 | Holiday reading for property investors
03 Dec 2018 | Popular areas to rent in 2018
November
30 Nov 2018 | Jesmond Real Estate
21 Nov 2018 | Getting to know your neighbourhood.
13 Nov 2018 | Islington Real Estate
09 Nov 2018 | Indicators for future growth
07 Nov 2018 | Hamilton Real Estate
02 Nov 2018 | New home construction to fall in 2019.
October
29 Oct 2018 | Fennell Bay Real Estate
25 Oct 2018 | Are you storm ready?
22 Oct 2018 | Fassifern Real Estate
15 Oct 2018 | How to keep your property cool
11 Oct 2018 | Elermore Vale Real Estate
08 Oct 2018 | Is it the right time to buy again?
05 Oct 2018 | Cooks Hill Real Estate
02 Oct 2018 | Avoid financial pitfalls
September
26 Sep 2018 | Coal Point Real Estate
19 Sep 2018 | Get your rental bond back
10 Sep 2018 | Carrington Real Estate
06 Sep 2018 | The rise of micro-apartments
03 Sep 2018 | Cardiff Real Estate
August
31 Aug 2018 | Downsides to positive cash flow properties?
28 Aug 2018 | Callaghan Real Estate
20 Aug 2018 | Booragul Real Estate
13 Aug 2018 | How To Find A Great Housemate
03 Aug 2018 | Boolaroo Real Estate
July
27 Jul 2018 | Blackalls Park Real Estate
20 Jul 2018 | Birmingham Gardens Real Estate
12 Jul 2018 | Beresfield Real Estate