Can I borrow more than 450k?

I recently got a pre-approval from a bank for 450k to purchase a second IP and wondered if there is another bank that could lend me more.

The pre-approval I have received is based on the following:

Salary income: 77k per annum (gross)

I currently have a loan for an IP. Here's the details:
Rent: $300 per week
Loan balance: 223k
Funds in offset: 20k
IP value: 279k
Interest: 4.54% interest only

I also have a PPOR valued 590k which I own outright. I do not wish to cross-collateralise my second IP with my PPOR.

Any tips on how I can borrow more (increasing my salary and rental income isn't an option for me for the next 12 months)? My expenses are not high and I know I an fund a higher loan.
 
Be careful not to apply to multiple lenders as you run the risk of frying your credit file.

Couple of ?'s:

1. Who is the current lender?
2. What is the proposed rental income from the 2nd IP?
3. Are you married and have dependents?
4. Where is the deposit coming from for the new IP purchase?
 
Yes, I'm well aware not to apply with multiple lenders.

My current lender is Suncorp Bank. They also gave me the pre-approval for a second loan.

When I was looking at properties last year under 450k, the proposed rent was 400-450pw.

I am not married and no dependents.

The deposit will come from my own savings, (which is currently 20k sitting in the offset account), plus borrowing against my PPOR.

I plan to put down a 10% deposit on the new IP.
 
Ok why not do an equity release against either PPOR and use it as the deposit instead for the new purchase (without cross securitising) instead of using your own cash?

Re borrowing capacity - you can easily go $800k using more generous lenders like Macquarie, NAB and AMP but whether you should use them this early on in your portfolio is another story.

FYI - Suncorp is one of the most conservative lenders when it comes to borrowing capacity. Keep this in mind if you want to pull equity out at a later stage.
 
I guess I like to minimise the loan against PPOR so I thought using funds in the offset makes sense.

Good to hear that there are other lenders out there that will loan me more than Suncorp. I won't need 800k, but I would like to consider properties in the 500s.
 
A lot of people don't like borrowing against their PPOR but I think if you step back and see the numbers - it would definitely make sense using the equity (and leveraging) against the PPOR to fund the new purchase.

I would also throw out there whether its best to use 20% deposit and forgo the LMI on the new purchase but this will be dependent on who many properties you plan to purchase in the next "xyz" years.

Think ahead and start planning from today.
 
Based on no kids and single...essy $450k + ...but you can't stay with suncorp ( ok to keep current loan with suncorp..but new loan will be with a diff bank)


I recently got a pre-approval from a bank for 450k to purchase a second IP and wondered if there is another bank that could lend me more.

The pre-approval I have received is based on the following:

Salary income: 77k per annum (gross)

I currently have a loan for an IP. Here's the details:
Rent: $300 per week
Loan balance: 223k
Funds in offset: 20k
IP value: 279k
Interest: 4.54% interest only

I also have a PPOR valued 590k which I own outright. I do not wish to cross-collateralise my second IP with my PPOR.

Any tips on how I can borrow more (increasing my salary and rental income isn't an option for me for the next 12 months)? My expenses are not high and I know I an fund a higher loan.
 
Thanks, had no idea Suncorp was so limiting. They have been good to deal with for the first couple of loans.
 
Id not worry to much about how much you can borrow today.

I typically ask my clients to look at a 10 to 15 year window.

What you are trying to achieve in the middle to long term, can be much more instructive and fruitful than a focus on the one current transaction - unless you plan that transaction to be your last.

If you are going to build a largeish portfolio, one of the things many of us need to get our heads around is what actions or inactions carry ACTUAL rather than perceived risk.

Your resources clearly show that you are serviceability bound, rather than equity bound, so a properly constructed plan may allow you to borro1 1.5 to 1.8 x what a "no plan" model will


ta
rolf
 
Thanks, had no idea Suncorp was so limiting. They have been good to deal with for the first couple of loans.

If you're with Suncorp, they'll pre-approve you to $450k and you're wondering if another lender will give you more for another IP ...

... without even looking at the numbers, the answer is probably "yes". Suncorp are so conservative towards investment that it's not funny.
 
Agree Suncorp are one of the worst out there.

Sure rate on its day might be sharp and the no Annual fee product wasn't too bad (As long as you lodged your application nice and early in their rate launch) but as far as long term portfolio building they are a way of reducing your wealth quickly.

Obviously without all the raw data it is difficult to give you an exact answer but quick calc suggests you could go to 650K.

Cheers
 
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