Making up a letter for the bank

Hi, I read on here that people make up a statement for the bank when applying for loans.All my loans are with St George so I want to try other banks now.

I have started and would like to know if I should add anything else.

I have listed assets (properties) and loans against them showing 56% equity. I haven't had any valuations since buying but pretty much know the value (will that mean anything?)

I also listed outgoings (interest, rates, strata etc) and incomings (rent, wages etc) showing I can afford more loans.

I've mentioned that I salary sacrifice but this can be stopped at any time as it's voluntary. Also that credit cards are paid out each month thus incurring no interest. We have no loans other than the property ones.

Anything else I should add?
 
They won't be very interested in your credit card payment history (unless you've ever defaulted. Then they get very interested).
They will want to know your credit limits on those cards. That's what can make or break you in terms of serviceability.
I've taken out and re-financed a dozen loans with different banks over the last few years. Not once have I ever been asked for details of holding costs, other that the interest charges. I assume they work on a formula, as they do for living expenses.
They will want to see the current lease agreements, though and evidence of the rents being paid.
Your LVR on existing property doesn't factor in too much, either, from what I've experienced. They can't verify it, anyway, without valuing every property you own. They are more concerned with how much your interest bill is each month and how much income you have to cover it.
 
Drop your credit cards down as low as you can,you can always put them back up again later. :D

It doesn't seem to matter that you pay them out each month :(
 
As a corporate (Big 4) banker I once knew told me, always make sure to pay off and really check the account is well-and-truly shut down before going cap-in-hand to the bank because "credit cards will $crew you over even years after you've paid them off" (should they pop up in the credit check).:(
 
Drop your credit cards down as low as you can,you can always put them back up again later. :D

It doesn't seem to matter that you pay them out each month :(

Which sucks big-time! I have an Amex, in my name, which is used exclusively for work expenses, which at times can be around $7-10k pm, so this limit is added to my personal CC, on which I put ALL expenses I can, and pay in full every month - which I've been doing since I got it in about 1997!! :eek:

And then the ironic thing about this is that the CC company keeps sending me unsolicited offers to bump up the limit, which if I accepted, would hinder my borrowing capacity with the same lender! :confused:

I think I see where they make their money! ;)
 
To be honest whislt it might sounds nice and flowery most lenders and Mortgage Brokers have a pre-formatted application form and will merely want the information to be able to assess the deal.

Of course as a Broker supporting documentation upfront certainly aids the application and helps in planning how to structure the deal for a client.
 
Thanks.

I've been meaning to drop the limits on our 2 credit cards as I pay them off each month so don't need a huge limit.

But just reading this I suddenly remembered when we took out our last loan St George were kind enough :rolleyes: to give us a credit card. I told them I didn't want them and they said it won't cost anything just keep them in case you want them later. :rolleyes:
I threw them in the safe. I don't know what the limit is. I'll take them in on Monday and get them to cancel them.

Any advice about which bank I'm best to go with?
 
Ouch, This doesn't bode well. I have a stupid amount of cards (like 7) with limits from $15 - $40K each. I use them all for different purposes and can't really get around it. All of them are paid off monthly and silly me I thought that was a good thing as it showed I could control debt.
 
Ouch, This doesn't bode well. I have a stupid amount of cards (like 7) with limits from $15 - $40K each. I use them all for different purposes and can't really get around it. All of them are paid off monthly and silly me I thought that was a good thing as it showed I could control debt.

From what I understand, each $5,000 of credit limit equates to a loss of around $25,000 in borrowing power.
How you use it and how controlled you are with it has no bearing, whatsoever.
 
Thanks.

I've been meaning to drop the limits on our 2 credit cards as I pay them off each month so don't need a huge limit.

But just reading this I suddenly remembered when we took out our last loan St George were kind enough :rolleyes: to give us a credit card. I told them I didn't want them and they said it won't cost anything just keep them in case you want them later. :rolleyes:
I threw them in the safe. I don't know what the limit is. I'll take them in on Monday and get them to cancel them.

Any advice about which bank I'm best to go with?

I'm having a good run with NAB at the moment, for what it's worth.
My last loan with them resulted in me being sent a gold card with a $10k limit. I have an application pending now. It's been conditionally approved but I was half expecting it to be declined due to the credit card limits I have in place.
 
I don't need LMI. Just a standard 80% loan on the property I wish to buy (no strings). I have enough for deposit etc.

Ideally I'd like to borrow more from the bank I go with also.

Looking at good rate obviously and not too many extra set up and ongoing charges. I do have an inencumbered IP I considered getting a LOC on but don't want to go there yet. I should be able to buy 2 more without that or LMI.
 
If you are looking at a 80% IP loan an dont require any frills then wholesale or non bank lender might be the way to go.

Few offering no application, valuation fees etc and attractive rates without any ongoings.
 
On that basis id still suggest Homeside or AMP, but they can be a bit slow unless u have a buddy in there that can move the file along.

Reason I asked wabout the lmi is that some lenders use different service calcs for below 80 and a diff one for above 80


ta
rolf
 
From what I understand, each $5,000 of credit limit equates to a loss of around $25,000 in borrowing power.
How you use it and how controlled you are with it has no bearing, whatsoever.

It will be interesting to see what happens when I apply for my next loan then as I've calculated that the cards are $170K in total (or $850K less in lending if you're right).

I had all the same cards two years ago (last loan) and wasn't made aware of any problems with it.

Ouch
 
It will be interesting to see what happens when I apply for my next loan then as I've calculated that the cards are $170K in total (or $850K less in lending if you're right).

I had all the same cards two years ago (last loan) and wasn't made aware of any problems with it.

Ouch

It's not an issue when you have plenty of serviceability in the tank. When the tank starts to run a bit low, it becomes an issue.
If you service OK on their service model, they're not going to tell you how much "surplus" serviceability you have.
Like all serviceability issues with banks, you don't find out until it's too late.
 
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