Abnormal expenses right before home loan application?

Discussion in 'Loans & Mortgage Brokers' started by Dishala, 3rd May, 2021.

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When to apply for loan?

  1. Apply in May

    1 vote(s)
    100.0%
  2. Wait till August

    0 vote(s)
    0.0%
  1. Dishala

    Dishala Well-Known Member

    Joined:
    1st Feb, 2021
    Posts:
    56
    Location:
    Sydney
    My income is $5k a month.
    My monthly expenses are usually $1.5k - $2k however due to some once off purchases April saw my expenses about $5k - $6k.

    I was able to get a lump sum of money which means I can potentially apply for a loan now and buy before prices get even higher. However worried that application might get rejected due to very high expenses for the last month.

    Should I just wait till August when the bank would only look at the previous 3 months (is this true btw?) and more indicative of my average monthly expenses?

    Thankyou all
     
  2. Tony Xia

    Tony Xia Structured Loan Advisor Business Member

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    Location:
    Bella Vista
    If they are once of expenses and your banker/broker make commentary on it, then it should be fine.
     
  3. Dishala

    Dishala Well-Known Member

    Joined:
    1st Feb, 2021
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    Location:
    Sydney
    Some of the purchases were also refunded for example we bought a washing machine and returned it a few weeks later. Wonder if this would still be looked at as an expense?
     
  4. Tony Xia

    Tony Xia Structured Loan Advisor Business Member

    Joined:
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    Location:
    Bella Vista
    These are once of expenses that could be deleted or pro rata 'd as long as proper notes are made
     
  5. Lindsay_W

    Lindsay_W Well-Known Member

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    Location:
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    This likely won't be an issue, one-off expenses like that are easily explained and clearly one-off shouldn't stop you from getting a loan.
    Some banks no longer require any statements to verify living expenses.
     
  6. Thomas Cutler

    Thomas Cutler Member

    Joined:
    7th May, 2021
    Posts:
    6
    Location:
    Canberra
    Definitely look to apply now large purchases are seen by banks as one off purchases and do not account for your actual living expenses.

    With that said if your broker is worried a lender may not write this off there are plenty of lenders who do not require bank statements. It may just be the path of least resistance to go with this one.