How do I increase my borrowing capacity?
One of the most frequently asked questions when it comes to securing a home loan is how much can I borrow?
The answer to this question of course, varies between lenders and applicants. Since everyone has a unique financial situation, it is difficult to estimate borrowing capacity without some specific details about the borrower in question.
However, there are some common requirements among a broad spectrum of lenders and there are also some useful tips you can follow to maximise your borrowing capacity in the eyes of lenders.
An easy way to get started is to input your details into an online mortgage calculator – this can give you a quick estimate of the amount of money you are able to borrow, based on a few factors such as income and expenses.
To get a more detailed account of your financial situation, it is best to speak to a mortgage adviser.
As a home loan professional with in-depth knowledge of the expansive range of products and lenders on the market, mortgage advisers are well-placed to offer you targeted advice about which option will best suit your personal situation.
In order to give yourself the best shot at securing the amount you desire, there are a few things you can do.
1. Close any inactive accounts – even if your balance is zero, the lender will still count this against you.
2. Pay off any unpaid debts and consolidate open lines of credit.
3. Set up a realistic budget for yourself. A savings plan will not only help you in the application process, but will prepare you for paying mortgage repayments each month once you move in to your new home.
4. Talk to a mortgage adviser about any financial areas you may need to address before applying for a loan.
Mortgage Choice have a great range of mortgage calculators to help with all those tough decisions that come with finding the right loan. Have a look through the calculators and when you are ready contact Mortgage Choiceto make sure you are heading in the right direction with the right advice.
