Bank won't lend Re: Borrowing capacity

S

stargazer

Hi all

I am with ANZ and they will not lend based on their policies. A broker i enquired with wasn't that much help.(not from this forum).

I want to purchase some land and now feel a bit frustrated that to buy the land i may have to sell one of my properties if i can't find a solution to this.

Single Income....70,000

Prop 1 Value 540000..............mortgage 344000..rent 500pw
Prop 2 Value 380000..............mortgage 215000..rent 330pw

Investment LOC...................limit 40000

I rent for 270pw.

Looking to buy land in SA around 200000

Are there any lenders that may accomodate me.

Regards
SG
 
Hi stargazer

Who lives off your PAYG income? You? Spouse? Children?

Any credit cards? What is the limit?

Personal Loans? Store Cards?

Is your $70,000 per annum gross, before tax and net of superannuation? Any packaging? Any HELP debt?

Checked your Veda? Any problems with your credit history?

What is the postcode, size and zoning of the land?

The more information, the better!

Cheers
Kristine
 
Hi Kristine
Thanks for your reply have added under blue.

Who lives off your PAYG income? You? Spouse? Children?
Single

Any credit cards? What is the limit?
Credit card limit is $5000 with ANZ nothing owing

Personal Loans? Store Cards?
nil

Is your $70,000 per annum gross, before tax and net of superannuation? Any packaging? Any HELP debt?
gross before tax

Checked your Veda? Any problems with your credit history?
credit history is good

What is the postcode, size and zoning of the land?
Rural land around 30 acres. Wanting to buy now for retirement in the future etc. Haven't any contract but when enquired broker said my borrowing capacity etc would get knocked back

Hope that helps
Regards SG
 
Hi Stargazer

The 30 acres zoned rural would not necessarily be a problem with eg CBA but I calculate that further borrowings with CBA would be maxed at around the $3,500 mark!

Not much help, is it?

Truth is, that there would be lenders which could possibly assess your borrowing capacity at not quite but almost there, eg $150,000 or slightly more, but probably not for the rural lifestyle at 30 acres

However, if you can find an habitable property with 30 acres, so that it can bring in some rent for you, then when you are ready to retire you can knock down & rebuild, and in the meantime the rent income would of course boost serviceability

You have the combination of having borrowed just about the maximum you can with the lenders which may take the security. The knack, perhaps, is not to sell one of the income producing properties, but to find a property which could be made into what you want, but which can also produce standard resident rents now

Hope this helps
Kristine

PS: Are you willing to refinace the ANZ? Are you willing for this to be, say, a six month project? Is the land on the market now or are you just starting to look around? It could be doable provided that you do not try and secure the borrowings against the lifestyle property.
 
Hi Kristine

Thanks for your input.

Yes at this stage i haven't set my sights on any particular property and i know what you mean. Re: property with income.

Did see one with a timber frame home and 15 acres $175000 but couldn't organize re: broker said no go....

I keep getting told that ANZ are the best in regards to borrowing capacity and if they knock me back then i have no chance with anyone else.

I have read on the forum that some lenders will accomodate better than big 4 or 6 not sure who they are but may have higher charges etc.

I am happy to look at all options.

Cheers
SG
 
Timber frame meaning an incomplete, uninhabitable house?

Unfinished houses are well nigh impossible to use as a security, so properties like that are not worth considering unless you are a cash buyer

Sorry, I love ANZ but they are not the highest servicing lender and not the easiest to please

Rates and Fees are the last item on the list

Finding the lender which will do the deal has to be the first item on the list: If they / more than one will do the deal, then you get to choose amongst the short list. You can always do the deal with one lender and refinance in a couple of years when you may be in a stronger financial position

Cheers
Kristine
 
Last edited:
See you have a problem Rolf in getting a phone call at 11.00pm on a Saturday night asking you could you fax thru another payslip on a deal (well thats i what i think he said).

I dont know some Brokers are so hard to please.
 
Rolf Latham said:
gee thats confessions of an addict :)

You must get some special Australian based Service that many of us dont .


ta
rolf
Click to expand...

Hi Rolf,

No, I am an ANZ banking customer. I have had some very enlightened Business Relationship Managers over the years who have supported me in what I have wanted to do.

But as a broker, I must say that the last few deals I have put up to ANZ have gone nowhere, yet the 'second choice' lender has done those same deals without a blink.

ANZ used to get the lion's share of the business. Don't know why they have changed but the GFC seemed to bring about a significant reluctance in lending attitude which hasn't corrected as yet

Cheers
Kristine
 
Don't get me started on ANZ! Army Mechanic for 20yrs honorably discharged has been working for six months at a Ford dealership as a mechanic (no probation), LVR 82% DECLINED unstable employment...
 
Focus said:
Don't get me started on ANZ! Army Mechanic for 20yrs honorably discharged has been working for six months at a Ford dealership as a mechanic (no probation), LVR 82% DECLINED unstable employment...
Click to expand...

perhaps they meant insufficient employment time,................if u can get it into CBA or NAB they might do it ( at least on the surface)

ta
rolf
 
stargazer said:
Hi all

I am with ANZ and they will not lend based on their policies. A broker i enquired with wasn't that much help.(not from this forum).

I want to purchase some land and now feel a bit frustrated that to buy the land i may have to sell one of my properties if i can't find a solution to this.

Single Income....70,000

Prop 1 Value 540000..............mortgage 344000..rent 500pw
Prop 2 Value 380000..............mortgage 215000..rent 330pw

Investment LOC...................limit 40000

I rent for 270pw.

Looking to buy land in SA around 200000

Are there any lenders that may accomodate me.

Regards
SG
Click to expand...

Gee mate, your serviceability is really tight- almost hit the end.
Even if you go for smaller lenders and one that will take in negative gearing + will disregard your crdit card ( $0 balance for 3 month in a row) - the max i can see you be able to get is $160,000

As Kristine mentioned- you may need to consider buying a place with "rent" and on 30 arces you better have some cash ...

However there may be a solution; it's to readjust and re structure your loans to increase serviceability...end of the day only YOU know what you can afford..the bank only goes off what's on paper- so let's "change" this paper.

Looking at your current loans; it looks like you had them for a few years... if you refinacne BACK with the same lender ( or diff)-

1. Refinance back to 30 years loan
2. Set up as interest only ( not sure what your set up is now)
3. Apply for a PAYG -adjustment - PAYG income tax withholding variation (ITWV) application (NAT 2036)- this will provide you with INSTANT tax relief in term of negative gearing EVERY pay = increase serviceability

Doing all 3 will boost your serviceability quite a bit. ALl you need to do later on is applied to a lender that takes in "net" income rather then standard gross.

Regards
Michael
 
Focus said:
Don't get me started on ANZ! Army Mechanic for 20yrs honorably discharged has been working for six months at a Ford dealership as a mechanic (no probation), LVR 82% DECLINED unstable employment...
Click to expand...

Try getting a lone being cash rich, asset rich , no employment, no go with my bank.
 
Focus said:
Don't get me started on ANZ! Army Mechanic for 20yrs honorably discharged has been working for six months at a Ford dealership as a mechanic (no probation), LVR 82% DECLINED unstable employment...
Click to expand...

If that's all the issue was then I'd be surprised it was declined. maybe someone didn't go into battle enough for you. I just had one approved at 90% a couple of weeks back for 6 months employment(same industry).
 
Hi Everyone

Thought i would give this thread a bump up. May be a sign of credit lending starting to ease slightly.

Re applied for refinancing and pretty much similar numbers as i indicated. Loans were approved within 2 days after valuations were completed.

Valuations came in around the same figures as i showed earlier. So nothing really has changed much.

Bank offered 1% discount variable rate.

Regards
SG
 
stargazer said:
Hi Everyone

Thought i would give this thread a bump up. May be a sign of credit lending starting to ease slightly.

Re applied for refinancing and pretty much similar numbers as i indicated. Loans were approved within 2 days after valuations were completed.

Valuations came in around the same figures as i showed earlier. So nothing really has changed much.

Bank offered 1% discount variable rate.

Regards
SG
Click to expand...

Hi

Good news

ANZ hasnt improved their serviceability model much.

So whats happened is either

1. The previous attempt met a bozo assessor ( we had another one this week, complete with wig, red noze and big shoes)

2. You applied via a branch or mobile lender and things were massaged ;) to make it work because your loan(s) were part of someone's goal.

3. You have a fair bit of fixed stuff this time round

4. You didnt use ANZ, which then of course makes it obvious why you got it done this time round


I do agree that policy has generally opened a little in recent times, but serviceability numbers havent changed much

ta
rolf
 
Hi

Rolf
The previous attempt met a bozo assessor ( we had another one this week, complete with wig, red noze and big shoes)
Click to expand...

As i said nothing changed same mortgage broker/ same bank / vals much the same / 80% lend etc etc

So with the options you showed i tend to think it may be the assessor one.

Makes a big difference when the bank says yes.

Regards
SG
 
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