Hi everyone
I've got the serviceability blues too. Was just reading a post further down started by Mark C. I'm in a similar situation and have posted before about this but I think I'm missing the point somewhere.
Can anyone tell me how to go about presenting a business case to by Bank Manager. I have been to a couple of Brokers who claim they are experts in Residential Property deals but I seem to be coming up with Brokers that work everything out using the "mum and dad" scenario. They too seem to be only dealing with a couple of the big banks. They must get more commission or something.
My case is that I own my own home, which is valued at $175,000 - Mortgage owing is $18,000. Have $6,5k credit card limit, maxed out. Have three rentals with mortgages of $237k combined and combined re-value of about $320k. I have a positive cash-flow of $10,400 per annum excluding rates & insurances.
Because I own my own business, which broke even last year I have to show my financials. Myself and my partner only took $23,500 in salary last year. The rentals are bringing in $525 per week, and the tax department owe me a $8,500 refund due to the rentals and family support that I did not claim, although the banks won't take this into account. They are saying that we can't service a new rental.
My problem with this is that we have a friend of ours has just bought his 6th rental. He does earn alot more in salary than us, but when I asked him if there is going to be a time when he can't service his loans he said no. I said why and he said because his rental income is covering his mortgages. I said to him that that was what we told the bank and they turned us down due to serviceability. He said that was wrong, and that you just have to explain it correctly to them, make them see sense. He's obviously more business-savvy than me, because I must be doing something wrong. He's also got this huge debt with the Inland Revenue department and doesn't own any of his properties outright. Doesn't even own his own home, or car, and is living in one of his properties. He's also using the same person at the same bank as us, but we get told something completely different than him.
He said you just need to write it all down on paper for them, so that they can see where you are coming from. I talk and talk to the bank and say the same thing he's telling them, but he gets the loan and I don't.
Am I stupid? Or is he just really clever.
Help!
Regards, QB
I've got the serviceability blues too. Was just reading a post further down started by Mark C. I'm in a similar situation and have posted before about this but I think I'm missing the point somewhere.
Can anyone tell me how to go about presenting a business case to by Bank Manager. I have been to a couple of Brokers who claim they are experts in Residential Property deals but I seem to be coming up with Brokers that work everything out using the "mum and dad" scenario. They too seem to be only dealing with a couple of the big banks. They must get more commission or something.
My case is that I own my own home, which is valued at $175,000 - Mortgage owing is $18,000. Have $6,5k credit card limit, maxed out. Have three rentals with mortgages of $237k combined and combined re-value of about $320k. I have a positive cash-flow of $10,400 per annum excluding rates & insurances.
Because I own my own business, which broke even last year I have to show my financials. Myself and my partner only took $23,500 in salary last year. The rentals are bringing in $525 per week, and the tax department owe me a $8,500 refund due to the rentals and family support that I did not claim, although the banks won't take this into account. They are saying that we can't service a new rental.
My problem with this is that we have a friend of ours has just bought his 6th rental. He does earn alot more in salary than us, but when I asked him if there is going to be a time when he can't service his loans he said no. I said why and he said because his rental income is covering his mortgages. I said to him that that was what we told the bank and they turned us down due to serviceability. He said that was wrong, and that you just have to explain it correctly to them, make them see sense. He's obviously more business-savvy than me, because I must be doing something wrong. He's also got this huge debt with the Inland Revenue department and doesn't own any of his properties outright. Doesn't even own his own home, or car, and is living in one of his properties. He's also using the same person at the same bank as us, but we get told something completely different than him.
He said you just need to write it all down on paper for them, so that they can see where you are coming from. I talk and talk to the bank and say the same thing he's telling them, but he gets the loan and I don't.
Am I stupid? Or is he just really clever.
Help!
Regards, QB
