Borrowing Power for the next IP

Discussion in 'Loans & Mortgage Brokers' started by Sharkish, 3rd Nov, 2020.

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  1. Sharkish

    Sharkish Member

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    Hi all, as per great people from the Introduction thread, I am now here to ask for advice/opinions or some sort of direction.

    Income: Approx 90-100k. + approx 100k total savings+shares.
    Current Loan for 1IP: 800k at 3.90% (Locked till Feb 2021)
    Current Loan Balance: 695k left.

    The IP has both a free standing house and a granny flat. Rent just almost covers the repayments.

    ====
    Based on some quick research, it would best seem to refinance to a 30year loan at a lower rate. (mostly likely variable) I've always done P&I, as I can't wrap my head around IO loans.

    I was hoping if I could draw the equity and see if I am able to get another loan for another IP. I have a feeling I might be maxed out on my serviceability, and thus unable to get another loan. Would this be accurate?

    Thanks in advance, this forum has been amazing so far.
     
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    A quick estimate you have borrowed about 7 times your income so close to being maxed. But you should get some proper credit advice.
     
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  3. Sharkish

    Sharkish Member

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    I figured as much.. credit advice, being a mortgage broker? (I suppose that’s obvious)
     
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  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    What is the value of the property pls ?

    ta
    rolf
     
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  5. Sharkish

    Sharkish Member

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    With the granny flat. About $900-950k. Most likely to lower half would be my best guess based on similar prices homes sold in the area.
     
  6. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    so at 925 max lend is 740 sans LMI

    Gonna be a hard one

    ta
    r
     
  7. Sharkish

    Sharkish Member

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    Damn, so I just need to pay the principle down more, or increase my income.

    or introduce a guarantor?
     
  8. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Subject to serviceability, a family guarantee for the next IP may fly. Depending on the rental return of the existing and new IP, and how much your rental outgo is etc


    Best to seek some specific credit advice as has been suggested


    Ta
    rolf