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  • Barry Le Brocq

MELBOURNE MORTGAGE FINANCE LENDING UPDATE – 14.06.19



LIVING EXPENSES ARE NOW A KEY ISSUE

  • in the past, lenders generally used minimum poverty line living expense allowances when assessing loans

  • most lenders have recently increased the allowance for living expenses when calculating borrowing power

  • increased allowance for living expenses can significantly reduce customer borrowing power

  • most lenders now require applicants to complete a detailed Living Expenses worksheet as part of an application

  • some lenders require the last three months bank statements and will assess living expenses from the statements

  • applicants should eliminate any unnecessary living expenses during the three months prior to applying for a loan

  • minimising unnecessary living expenses and increasing savings are both important when applying for finance

  • loan applications must be very carefully prepared to satisfy stricter lender assessment standards

COMPREHENSIVE CREDIT REPORTING NOW IN EFFECT

  • all lenders obtain a Credit Report when assessing home loan applications

  • Credit Reports now provide far more detailed information about loan repayment history than before

  • lenders can look at repayment history over a two year period on existing loan accounts held by borrowers

  • borrowers should make repayments on time and avoid erratic repayment histories on their Credit Reports

  • obtaining a copy of your personal Credit Report is very important prior to applying for finance

INVESTMENT LOANS AT OWNER-OCCUPIER INTEREST RATES

  • some lenders will approve finance for investment purposes at owner-occupier rates

  • borrowers must offer their primary residence as security for the loan, not the investment property

  • loan purpose might include purchase of investment property or purchase of shares

  • example : $400,000 home loan and $200,000 investment loan for shares, both financed at owner-occupier rate

REVERSE MORTGAGE LOANS FOR SENIORS OVER 60

  • specialist lenders are available to provide finance to seniors who have retired

  • residence is offered as security for most loans, but holiday home or investment property can also be offered

  • loan amount calculation depends on value of property and age of younger borrower

  • common purposes : home improvements, clearance of other debts, extra monthly income, car, travel

  • independent legal advice is compulsory and loan contracts must be signed in presence of customer’s solicitor

Barry LeBrocq Melbourne Mortgage Finance Mob 0437417042 Web www.melbournemortgagefinance.com.au

NOTE: Loans offered are available at time of Update release, but lenders can change or withdraw product offers without notice

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