[et_pb_section fb_built=”1″ custom_padding_last_edited=”on|desktop” admin_label=”Section_2_Text Left:” _builder_version=”3.22″ background_color=”#f7f7f7″ custom_padding_tablet=”50px|0|50px|0″ custom_padding_phone=”” transparent_background=”off” padding_mobile=”off” make_fullwidth=”off” use_custom_width=”off” width_unit=”on” custom_width_px=”1080px” custom_width_percent=”80%”][et_pb_row padding_mobile=”on” column_padding_mobile=”off” custom_padding_last_edited=”on|phone” admin_label=”Row” _builder_version=”3.25″ background_color=”#ffffff” background_size=”initial” background_position=”top_left” background_repeat=”repeat” max_width=”768px” custom_padding=”60px|60px|60px|60px” custom_padding_tablet=”” custom_padding_phone=”40px|20px|40px|20px” make_fullwidth=”off” use_custom_width=”on” width_unit=”on” custom_width_px=”768px” custom_width_percent=”80%”][et_pb_column type=”4_4″ _builder_version=”3.25″ custom_padding=”|||” custom_padding__hover=”|||”][et_pb_post_title categories=”off” comments=”off” disabled_on=”off|off|off” admin_label=”How to Improve Your Chance of Getting Financed” _builder_version=”3.0.87″ title_text_color=”#00afff” title_font_size=”36px” title_all_caps=”off” meta_text_color=”#95989a” parallax=”on” parallax_method=”off” custom_margin=”||40px|” title_font_size_tablet=”” title_font_size_phone=”28px” title_font_size_last_edited=”on|phone” parallax_effect=”on” use_border_color=”off” border_color=”#ffffff” border_width=”1px” border_style=”solid”] [\/et_pb_post_title][et_pb_text admin_label=”Text_B:” _builder_version=”3.27.4″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” use_border_color=”off” border_style=”solid”]<\/p>\n
When investing in houses, \u00a0keeping your finances in order should always be a top priority.<\/span><\/p>\n Obviously, without the ability to get financing you\u2019re pretty much left stuck wherever you\u2019re at in your property investing journey.<\/span><\/p>\n So how can you ensure that you\u2019re ready to meet with a prospective lender?<\/span><\/p>\n In a word, preparedness.<\/span><\/p>\n Be prepared to answer all of the lender\u2019s questions, and have a few of your own set aside as well.<\/span><\/p>\n As you know, banks are in the business of lending.<\/span><\/p>\n They\u2019re also, however, in the business of keeping their shareholders happy.<\/span><\/p>\n To fulfill their mission to both parties, they prioritise their lending based upon a number of factors, which we\u2019ll get into a bit further on.<\/span><\/p>\n [\/et_pb_text][et_pb_text admin_label=”Text_H3: ” _builder_version=”3.27.4″ header_font=”Open Sans||||” background_size=”initial” background_position=”top_left” background_repeat=”repeat” use_border_color=”off” border_style=”solid” saved_tabs=”all”]<\/p>\n [\/et_pb_text][et_pb_image src=”https:\/\/www.trc-gorod.ru\/wp-content\/uploads\/2017\/01\/shutterstock_550263520.jpg” alt=”What the bank is looking for” align_tablet=”center” align_phone=”” align_last_edited=”on|desktop” admin_label=”Image_384px” _builder_version=”3.23″ animation_style=”slide” animation_direction=”left” animation_duration=”500ms” animation_intensity_slide=”10%” custom_css_main_element=”max-width: 384px;” use_border_color=”off” border_color=”#ffffff” border_width=”1px” border_style=”solid” sticky=”off” always_center_on_mobile=”on”] [\/et_pb_image][et_pb_text admin_label=”Text_B:” _builder_version=”3.27.4″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” use_border_color=”off” border_style=”solid”]<\/p>\n Banks take on risk every time they lend, but they do everything they can to minimise their risks. <\/span><\/p>\n Note: You too should minimise your risk if you\u2019re investing in houses, to make the most of any gains your portfolio achieves.<\/span><\/i><\/p>\n Banks will look for:<\/i><\/b><\/p>\n Each of these factors tell a bank a lot about not only your capacity to pay, but the likelihood that you\u2019ll meet your obligations once you\u2019ve begun investing in houses.<\/span><\/p>\n Your ability to pay is not the only thing banks will look at. Since the investment property will be security for the loan, they\u2019ll factor it into their decision too.<\/span><\/p>\n Property attributes:<\/i><\/b><\/p>\n Note: Even if the bank agrees to lend, if you\u2019re getting mortgage insurance the insurer still has to agree to cover the transaction.<\/span><\/i><\/p>\n [\/et_pb_text][et_pb_text admin_label=”Text_H3: ” _builder_version=”3.27.4″ header_font=”Open Sans||||” background_size=”initial” background_position=”top_left” background_repeat=”repeat” use_border_color=”off” border_style=”solid” saved_tabs=”all”]<\/p>\n [\/et_pb_text][et_pb_image src=”https:\/\/www.trc-gorod.ru\/wp-content\/uploads\/2017\/01\/shutterstock_551742733.jpg” alt=”eliminate unnecessary expenses” align_tablet=”center” align_phone=”” align_last_edited=”on|desktop” admin_label=”Image_384px” _builder_version=”3.23″ animation_style=”slide” animation_direction=”left” animation_duration=”500ms” animation_intensity_slide=”10%” custom_css_main_element=”max-width: 384px;” use_border_color=”off” border_color=”#ffffff” border_width=”1px” border_style=”solid” sticky=”off” always_center_on_mobile=”on”] [\/et_pb_image][et_pb_text admin_label=”Text_B:” _builder_version=”3.27.4″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” use_border_color=”off” border_style=”solid”]<\/p>\n Lenders use something called a DSR when evaluating your loan application. The Debt Service Repayment formula uses the following factors when determining your financial stability.:<\/span><\/p>\n Take a look at the following tips. If any of them apply to your situation, make the suggested changes to improve your chance of getting financing.<\/span><\/p>\n Lots of credit cards?<\/span><\/p>\n You might want to limit yourself to a single credit card with a lower available credit, say around $2500 or so.<\/span><\/p>\n Why?<\/span><\/p>\n Because even if you owe nothing whatsoever on your credit cards, lenders will calculate your credit limits in your eligibility, putting a stop to your goal of investing in houses before you’ve even started.<\/span><\/p>\n In the bank’s eyes, <\/span>having the potential to rack up your debt <\/span><\/i>is the same as having done so.<\/span><\/p>\n Two things; check to make sure you’re saving consistently (and that your account reflects that) and make sure you have an adequate buffer for unexpected costs and emergencies.<\/span><\/p>\n Note that if you’re borrowing more than eighty percent, some lenders will require that your savings be equal to at least five percent of the purchase price of the investment property.<\/span><\/p>\n If your savings is haphazard, start making regular payments to your savings account. This shows potential lenders that you’re a smart money manager and it goes towards the buffer that they’re looking for.<\/span><\/p>\n Check your credit file and fix any errors or omissions before applying for a loan. <\/span><\/p>\n If your credit is less than stellar, that doesn’t automatically mean you’ll be turned down. Every lender is different and has different criteria. <\/span><\/p>\nWhat the bank is looking for<\/b><\/h3>\n
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Improve your chances<\/b><\/h3>\n
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Reduce and\/or eliminate unnecessary expenses<\/b><\/h4>\n
Check your savings<\/b><\/h4>\n
How’s your credit?<\/b><\/h4>\n