13 Ways to Maximise Your Borrowing Power
Oakleigh, Australia - September 6, 2023 / Mortgage Buzz /
Interest rates, serviceability or your borrowing capacity, assessment rates, loan products, services, fees, and charges. These things can be an overwhelming experience to wrap your head around. Not everyone understands the full capacity of their borrowing potential. Thats why you need to book with one of our highly specialized First Home Buyer brokers at MortgageBuzz to utilize your best chance of obtaining the right home loan for you and the right lender.
Your chosen broker will hold your hand from start to finish and use their knowledge and maximize the potential of your income and increase your borrowing capacity by taking you to the right bank that has the right credit policy for you.
Keep in mind that we all think every lender is the same, but they are not, every lender has different risk appetites which are written in their credit policies so not one size fits all. At MortgageBuzz we have the education and training to find the lender that suits your situation and position. With over 60 lenders on our panel, we have many options and products that suit your individual needs.
We are committed to you from start to finish and you will have our attention and we make you a priority, not a number. Our mission is to treat everyone with respect and give a high-quality service and no less is acceptable. It doesnt stop there, your broker at MortgageBuzz is here for the life of your loan, negotiating your interest rates throughout your loan and maintaining any changes that you may require as your financial life journey changes.
Below are some examples for you to educate yourself, so continue reading as knowledge is POWER!
CALCULATE YOUR BORROWING POWER
Liabilities affect borrowing capacity, such as credit cards, car loans, By Now Pay Later accounts, personal loans, store cards, and anything that affects how much you can borrow with lenders.
If you can clear or reduce your liabilities before proceeding with your loan, or lower your credit limits, this can have a positive impact on your borrowing power and get you a better deal.
If you are not able to clear the balance, debt consolidation may be a better option for you by reducing your monthly repayments and increasing your borrowing and cash flow.
Having your credit score checked by your broker at the time of discussing your loan to ensure your credit history is clear is important and gives your broker an indication of which lenders are available to you.
If you have been on time with all your repayments, banks will look more favourably at you and potentially negotiate a lower interest rate, increasing your borrowing capacity.
Making balanced decisions and cutting expenses that are no longer needed, or reducing or avoiding unnecessary expenses help maximizing your borrowing power. Lenders will want to see six months of your living expenses, and by reducing expenses and having a good budgeting habit, you will improve your servicing.
Lenders look at your saving pattern for the last 3 months and require you to save a 5% genuine deposit of the purchase price to qualify for a home loan. We understand that saving a deposit could be challenging especially if you have a young family and youre paying rent. Some lenders allow rental payments by using your rental ledger to prove genuine savings.
By having a larger deposit, you will reduce the amount of money you will need to borrow and reduce the amount payable on your Mortgage Insurance (LMI) policy.
You can also avoid having to pay Lenders Mortgage Insurance by having a second security added, either one that you own or by a second party such as a guarantor (parent or close family). By using both property values, you decrease the Loan to Value Ration (LVR) of your loan, avoiding Lenders Mortgage Insurance, and potentially lowering the interest rate, and by doing so, increasing your borrowing power.
Accessing government schemes could avoid many fees and charges. For example, if you are a First Home Buyer, you can take advantage of the governments Low Deposit Scheme, or if you are purchasing a brand new home should be eligible for a First Home Buyers Grant (FHBG) allowing you to borrow higher than you normally could without having to pay for Lenders Mortgage Insurance or give $10 $20 depending where you purchase.
Avoiding or decreasing Stamp Duty payable.
There are other ways of qualifying for a discount on your stamp duty, you may have a concession card that your solicitor or conveyancer can use to lower the Stamp Duty payable.
Note, that you will have transfer fees to pay and potential fees such as house rates or water rates, maybe land tax, and settlement fees. Your broker at Mortgage will estimate a buffer on your loan application so you do not have a shortfall at settlement. Our fund's position report that we provide you will explain what your costs ensuring you a non-stressful settlement. We want you to be excited on the day of your settlement not stressed.
Non-conforming lenders are a type of lender that considers loan scenarios that other traditional banks wouldnt. They have a wider range of products and are more flexible when it comes to servicing power which can potentially give you a better borrowing capacity. Keep in mind, however, that non-conforming lenders generally may have a higher interest rate than conforming lenders.
If you are self-employed, generally you will need to show one to two years of your financials. Two year is normally averaged and could lower your servicing capacity. A lender that only needs one year could increase your borrowing power. Add Back, Interest and once off expenses could be used to increase your income.
If you are self-employed make sure that you speak to your accountant and let them know that you want to purchase or lend money so when your tax returns are due this is kept in mind. As we all know your accountant helps minimize your tax payable by lowering your income. A conversation with your accountant prior to organizing a loan could be beneficial and improve your servicing capacity. Your broker at MortgageBuzz is more than happy to organise an appointment with you and your accountant to ensure that we are all on the same path.
Depending on which industry, youre in, overtime could be calculated differently with different lenders, some lenders could use a lower percentage of overtime than other lenders. Choosing the right lender could maximise how much overtime is used thus increasing your borrowing power. Also increasing your overtime, you work should boost your income therefore increase the amount you can borrow.
Increasing your hours at work will help increase how much you can borrow, although you will need to choose the right lender as different lenders use different percentages. Most lenders policies want to see six months of employment in a casual job to average your annual income.
Bonuses, Commissions, allowances, company cars, child maintenance, pensions, family benefits A&B and trust income, boarders, or rentals all could increase your income. Self-employed Add backs, depreciation, once-off expenses all this could make up a part of your income. Dont worry MortgageBuzz brokers will ask you all the right questions and uncover!
Understanding HECS Debt
Many first-time home buyers may carry student debts, which generally lowers your servicing capacity as this may be deducted from your salary or pay. You may choose to pay off this debt with part of the money you have saved for your deposit. However do not pay this debt off until you speak to one of our First Home Buyers specialist brokers at MortgageBuzz. You dont want to decrease your deposit without advice from your specialised First Home Buyer broker.
Addressing Poor Credit History
Unveiling the Importance of LVR
Variances Among Lenders
CALCULATE YOUR BORROWING POWER
Navigating the intricate landscape of borrowing capabilities and home loans can be overwhelming. With our experienced and knowledgeable mortgage brokers, MortgageBuzz can be an invaluable partner throughout this journey. Heres how we provide assistance:
Collaboratively, we will comprehensively assess your financial status, encompassing income, expenses, and financial aspirations. This information serves as the basis for accurately determining your borrowing capacity and products and services you need.
As impartial specialists, we here at MortgageBuzz maintain an extensive network of lenders, including banks, credit unions, and non-bank institutions. Our experience enables us to adeptly compare loan offerings from various sources to identify the most suitable option for your requirements.
At MortgageBuzz we take charge of negotiating with lenders on your behalf, aiming to secure competitive interest rates and favourable loan terms. Additionally, we aid in compiling and submitting your loan application, simplifying the process.
Throughout the home loan application and approval process, Mortgage Buzz ensures unwavering support. We will address your inquiries and provide full transparency and understanding at every step of the journey.
Your MortgageBuzz broker is more than happy to organize property reports, and engage with Real Estate Agents on your behalf to ensure that you purchase at a competitive price. We communicate with the Real Estate giving them confidence that you are the better candidate than all other purchasers or bidders. We keep your agent involved all the step of the way of your loan application, so the vendor sees you as the best candidate.
We can help organize youre building and pest inspection. Put you in touch with one of our trusted conveyancers or solicitors for your settlement and work with them all the way to settlement. Our conveyancer and solicitors are more than happy to read your section 32 and ensure that the property you purchase has no hidden conditions faults or damage.
Our trusted partner will make sure that you dont sign a contract that puts you or your deposit at risk. Making sure that you are not making a mistake on your purchase.
Should you want even more extra attention your MortgageBuzz broker is more than happy to come along and support you if the property you are purchasing is going to auction.
Or come along when you are signing your Contract of Sale and advise you on what special conditions you require like Subject to Finance or Subject to Pest and Build. Maybe you require a Deposit Bond if you do not have the full deposit which needs to be a special condition or Government Grants.
With MortgageBuzz you will be in excellent hands, no doubt about it because we have a high expectation of our team and hold each other accountable. No less is acceptable.
We hope this helps you to understand maximise your borrowing power. MortgageBuzz will help you in your journey. Contact a MortgageBuzz Broker for more tips on How to Maximise your Borrowing Power. Book a Zoom meeting or a face-to-face appointment on 1300 081 557 or email hello@mortgagebuzz.com.au
Lets make dreams together come true!
Contact Information:
Mortgage Buzz
12/211 Warrigal Road
Oakleigh, Victoria 3166
Australia
Maria Aceto
+61 1300 081 557
https://mortgagebuzz.com.au/
Original Source: https://mortgagebuzz.com.au/2023/08/ways-to-maximise-your-borrowing-power/
COMTEX_439605083/2827/2023-09-06T01:13:40