Just bought/read More Wealth From Residential Property by Jan Somers (seemed the thing to do, seeing as I'm on the Somersoft forum!)
One of the best things the book did for me was to spell out the DSR (debt service ratio) calculation, which is that (AS A GUIDE ONLY, because banks differ) your total loan payments have to be less than your eligible income.
Eligible income = 30% of wages + 80% of rent
BUT...I'm thinking things have probably changed since then. Are the 'standard' percentages different now?
(I understand banks each calculate this differently yada yada, but I'm just after a basic formula to get an IDEA of serviceability for next IP/s.)
One of the best things the book did for me was to spell out the DSR (debt service ratio) calculation, which is that (AS A GUIDE ONLY, because banks differ) your total loan payments have to be less than your eligible income.
Eligible income = 30% of wages + 80% of rent
BUT...I'm thinking things have probably changed since then. Are the 'standard' percentages different now?
(I understand banks each calculate this differently yada yada, but I'm just after a basic formula to get an IDEA of serviceability for next IP/s.)
