HOW MUCH CAN I BORROW?
Investment property borrowing
- Most lenders will do 80% as the norm but some are stuck on 70% unless they also have your own home and others will do 90%.
- If there are multiple properties on 1 title then the LVR will be less, depending on the number of dwellings and the funder guidelines.
- The borrower will need to be able to prove income or, if self employed, provide the last 2 years financial accounts.
LO DOC LENDING – PROPERTY INVESTMENT
What is Lo Doc?
Often business owners and other self-employed people don’t’ have current financial accounts or their expenses have been very high in a particular year which means the ‘provable’ income is too low to be able to borrow money for property investment. Then there are certain types of businesses like Property Traders and full time renovators who can have issues with borrowing. The banks were really gun shy for a while with these occupations but that is changing once again. The old Lo Doc meant that the borrower could more or less put down any number for income which isn’t the same as the current Lo Doc lending. The borrower will have had to be in business for a min of 18 mths and be GST registered. One lender only needs the last month business and personal accounts and as long as the declared income is in line with the expected income for the type of business then that’s generally accepted. Max lending is to 70% LVR and the property needs to be residential and in a main centre. A valuation is required by a panel valuer so don’t just get any valuation done until you check that the valuer is acceptable to the lender.
Lo Doc rates vary according to the lender but some are not too different from standard lending rates and application fees can be minimal.
If you are buying and selling property regularly then there are non bank lenders who will readily supply short term finance for this purpose up to 70% but the costs are higher than the std Lo Doc product. Individual feedback is available by contacting us.
65% as an asset lend loan for 6 months. This is particularly useful for property trading
Can I borrow while overseas?
Non Residents can borrow up to 80% LVR in general
The banks have fewer issues with Aussies and New Zealanders or those with NZ residency but lending is available for all nationalities. The LVR may be reduced though.
Do allow more time to obtain finance. It will pay to ask us to provide a pre-approval so that you can purchase confidently when you find a property. Do be aware that a pre-approval is not the same as an unconditional approval.