One for the brokers

Hi,

Some help would be greatly appreciated! Just a hypothetical as I'm currently maxed out. My situation is:

- Loans of $1.45 million (5 IP's)
- $350k cash savings
- weekly rent $1610 total all IP's
- $85k salary
- no dependents

What would improve my borrowing capacity more:

1) selling one IP that would clear $148k of the debt and give me an extra $100k cash

2) sell one IP where I would break even but clear $290k off the total debt

Not sure if doing this would put me back in the game but curious as to which would be more effective?

Cheers

Dan

 

3) look at a possible refi/equity pull and purchase with one of the last remaining "generous" lenders. LVR on refi/equity pull and purchase would probably need to be sub 80% to get it to work.

I haven't crunched the numbers - but if you have no/or little PPOR debt (or don't pay too much rent/board) and no other personal debt then it might be doable.

Cheers

Jamie

 

Thanks @Jamie Moore

No PPOR debt and pay $250/week rent. ill be putting the $350k towards the new purchased (approx $1million) so new loan will be around $650-$700k if possible to borrow.

 

I haven't run the numbers either but I doubt you will service with any regular lender other than the likes of Liberty.

 

I haven't crunched the numbers but it could be doable - will depend on your living expenses too.

Cheers

Jamie

 

Thank everyone. I figured I was in trouble with most lenders. Might give liberty a call so I can at least have a plan of attack.

 

Rather than continuing to just contact lenders at random, why don't you give Jamie a call so you can get some specific direction.

 

Gday @Peter_Tersteeg ive actually got a broker through oxygen home loans. I just don't like bombarding him with a number of probables when I'm still up in the air about my next move. I thought I'd just ask the question here so I could be better informed about a few things.

Cheers

 

I'm reasonably certain that your broker would prefer you to contact them rather than Liberty directly.

Cheers

Jamie

 

Your broker knows your circumstances better than anyone here does, or what Liberty ever will. They really are the best ones to discuss your lending strategy ideas with.

 

Agree with Peter & Jamie should be doable but be careful going directly to the lender as there is no second chance if you don't present the application in the correct manner.

Of course have had to make an assumption on Living Expenses.

 

Good advice!

 

So it is not wise to go directly to the lender?!

 

No it's not wise in most instances - much better off seeing a broker.

 

Generally when going to the smaller lenders your best to go via your nominated finance person. There's generally a few alternatives to run with, and its likely going to be a big time saver than going direct to a few different lenders.

On the flipped, some brokerages have clawbacks arrangements and Liberty are often an interim type lender (i.e. a lender where you have an exit plan with), that may be one reason for seeking direct relationship. That may impact an exit fee if done in a reasonably short time period.

 

Is there a second chance if you don't present your application to a broker in the correct manner in the first instance?

 

Depends on how badly you messed up the first time.

 

With credit scoring, forgetting to put a transaction/savings account or an estimate of superannuation in can mean a decline with some borrowers with some lenders.

Forgetting to list liabilities like credit cards, charge cards Harvey Norman etc can certainly kill an app. Some lenders will give the borrower the benefit of the doubt, most won't.