Tighter lending conditions mean that getting smart advice is essential

Whether you are looking to buy an investment property or your own home, lending standards are higher and the borrowing process more arduous than before. These tougher credit conditions mean that using an experienced mortgage adviser is more valuable than ever.

What’s changed?
– Investors are being charged a premium interest rate compared to owner-occupiers, and will typically require a bigger deposit.
– Getting an interest-only loan is difficult for everyone. If you only qualify for a Principal and Interest loan, your monthly payments will be higher and investors can only claim the interest as a tax deduction.
– All borrowers need to provide a far more detailed summary of living expenses in their loan application, as lenders are checking each applicant’s capacity to make repayments regardless of their Loan to Value ratio (LVR).
– Borrowers will also need to supply more supporting documentation of their expenses, such as six to 12 months of saving account statements. As a result, if borrowers need to adjust their expenditure, they’ll need the foresight to do this up to 12 months before applying for a loan.
– Lenders are using an assessment rate of over 7.25% when checking a borrower’s ability to make repayments, despite interest rates being considerably lower.

So, what’s the solution?
1. As a Smartline Mortgage Adviser, I will help you try to achieve a much better borrowing outcome.
2. I keep track of how the different lenders calculate your borrowing capacity, and what type of loans – and borrowers – they will consider. By knowing which loan products are available and appropriate given your circumstances, and with access to over 27 lenders, I will find you a suitable loan, to save you time and give you the best chance of a successful loan application.
3. I know what information lenders need to see and how it should be presented to give you the best chance of success. If you have more complicated circumstances, for example if you are self-employed, this is particularly crucial.
4. My existing relationships with lenders helps me to negotiate a competitive deal on your behalf and more easily resolve any challenges.

Please give me a call anytime to discuss the current lending environment and how I can help you achieve your goals. My mobile is 0422594980 and email is jazzopardi@smartline.com.au.

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