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Which borrowing calculator to use??

Discussion in 'Property Finance' started by chunho01, 15th Aug, 2015.

  1. chunho01

    chunho01 Member

    Joined:
    4th Jul, 2015
    Posts:
    22
    Location:
    VIC
    I'm meeting my broker to discuss next week, but I'm just playing around with some borrowing power calculator in the meantime, and the results are just hilarious, if not ridiculous. They are so different!!

    Aussie = $560,000 (Too much? Should I not enter my full rental income in 'other income'?)
    HSBC = $450,000 (Most realistic of them all)
    Anz = $392,000
    Westpac = $329,000
    Homehero = $155,000 (Like... seriously??? I must have entered some field wrongly?)

    Which one is trustable? Any trustworthy calculator that I can use?
     
  2. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Sydney
    In real life they will be different too - vastly different.
     
  3. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    Posts:
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    Location:
    Melbourne, Nationwide
    You can't rely on online borrowing calculators, they are sales tools designed to generate business and aren't accurate. They rarely properly reflect the banks actual lending policies and even if they do, odds are you're not knowledgeable enough enter the data properly unless you also understand that lenders policies.

    Meet with the broker, they're more qualified to give you answers on this than a website is.
     
  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Location:
    Gold Coast
    they are all trustworthy. im sure they all have the right calcs for the right input

    its the input and the interpretation of the credit criticals that will determine who will lend what.

    While much is simple in this area of purchasing props, its neither obvious nor logical.

    ta
    rolf
     
  5. Redom

    Redom Mortgage Broker Business Member

    Joined:
    18th Jun, 2015
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    Location:
    Sydney (West) and Canberra
    There can be big differences in borrowing power results depending on individual bank policies.

    Usually as ones scenario becomes more uncommon the bigger the differences will be. For example, if one of two applicants have been employed F/T for one day, or short term casual, actual borrowing power calculations would be very different from lender to lender, as some will include and others will exclude.

    Also different treatments of mortgage debt will make a big difference - so for those with portfolios, will see a substantial difference between someone like ANZ and NAB/FirstMac.

    In terms of online calculators, they're not that accurate...

    Cheers,
    Redom
     
  6. Burramys

    Burramys Well-Known Member

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    28th Jun, 2015
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    89
    Location:
    Melbourne
    Agree. I have a Veda score in the top 20%, every year my savings goes up, the offset has nearly enough to buy a house, and yet I've always struggled to get a mortgage. The reason is that I'm self employed, investing. Lenders discount my income by 25-50% when the reality is that I have easily covered IO loans for 20 years and saved. The GFC was punishing as a builder was quite naughty - took him to court for a six figure amount, won - and there were problems. The broker sorted the lender and it's worked. Maybe I should have kept the 9-5 job ...
     
  7. Harry Goyal

    Harry Goyal Member

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    22nd Jul, 2015
    Posts:
    8
    Location:
    Victoria
    Hello,
    These all calculators are just meant to provide you an estimate. For the exact figures you must always consult a lender or a professional expert...