Realestate.com.au head of home loans Andrew Russell in their Sydney offices. Pic by James CroucherWHILE banks are cracking down on home lending, buyers can still get into the market, they just have to be better prepared than before.The easiest and most important thing you can do to make sure you get the green light on your home loan application is have a detailed understanding of how you spend your money.Most of us have a vague idea of how much we chew through every week, but it’s not until you actually sit down and put pen to paper and add up every little cost that you can really understand where your money goes and what your borrowing capacity is.You may not buy news clothes, birthday gifts or pay the car rego every week, but they are no doubt expenses you have during the course of the year that you should be aware of and factor into your calculations.Realestate.com.au home loans executive manger Andrew RussellAs a borrower, if you can present your potential mortgage provider with a realistic idea of how much money you need to live the life you do, it makes it much easier for them to weigh up whether you are a good risk to take.Borrowers now have to be prepared to provide full transparency of their expenses.If you provide a lender with three-month’s worth of bank statements it will analyse this and soon work out what you are spending money on that you hadn’t factored into your application – yes they will see that every Friday night you spend $50 on takeaway from Uber Eats, you download a dozen songs from iTunes every month and buy a lottery ticket at the newsagent every weekend.Supplied imageIt’s not that borrowers are looking to mislead lending institutions, it’s just that sometimes people don’t realise how much all those little expenses add up.There are plenty of apps now that can be used to help you track exactly where all your money is going and it is a good first step for working out how to improve your savings and budget to buy a home.While it might sound all doom and gloom, being honest about your finances is what will ultimately help you secure a loan, which you can actually afford to repay and that benefits everyone in the long run.Generic home for sale sign. Picture: THINKSTOCKAustralians lobbied for a Royal Commission into the banking sector and tighter lending criteria are part of the outcome of that.The purpose isn’t to prevent borrowers from obtaining a loan but to make sure they are better protected when applying for what will likely be their biggest financial commitment in their life.More from newsParks and wildlife the new lust-haves post coronavirus15 hours agoNoosa’s best beachfront penthouse is about to hit the market15 hours agoAll these new measures really do are safeguard you as a property buyer; it doesn’t necessarily make it harder to get finance, although how much you can borrow now might be different to in the past.The best way to ensure you can buy a new home is to work out your finances now – before you start searching for a property.A mortgage broker can really help you with this. They keep banks competitive and honest in their pricing and importantly they will help you find a loan which best suits your requirements.Go to your mortgage provider with a clear idea of your borrowing capacity and get a pre-approval. It could mean the difference between snapping up your dream home quickly, before the competition can, and missing out because you were caught up getting all your documentation together.If you are planning on buying within the next year start investigating the market now, get all of your financial documentation in place and save, save, save.Do your independent research and also seek the help of your real estate agent, they are the ones who can tell you exactly what properties are selling for in the market you are interested in.If you do all of this, once you find the right property you’ll be in the best position to act quickly.Know where your money is going. thinkstockIf you finances are not as straight forward as most borrowers, you may work on a series of short-term contracts, the tightening of lending practices doesn’t necessarily preclude you from buying – you may just need to be more organised to show lenders you will not come unstuck.Try and line up another contract for when the current one finishes so that the lender can see you have “continuous employment’’.Also show them proof of the level of continuous employment over the previous year. You may need to speak to a number of lending institutions to find the one which best suits your circumstances.If banks are not prepared to operate in this space don’t be disheartened, other lenders may be more willing to offer a product and take the riskFor all borrowers, whether experienced or first timers, if you have a strong deposit, a good solid income and you manage your money well, you should be fine.No matter what the outcome of the Royal Commission into banking, lending will continue – the benefit for the home loan customer is that given the greater scrutiny to ensure responsible lending you will feel assured you will be able to make repayments if interest rates increase.
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A Delray Beach middle school was evacuated following bomb threat, police said.Authorities are currently at Carver Middle School investigating the matter.This story is developing.