In today’s world, it is highly likely that you will need to approach a financial institution for a loan at some stage in your life. Maybe you want to buy a car, a boat, take a holiday or buy a house? The loan approval process can be very daunting so Shannon Ingram from Smartline Personal Mortgage Advisers has given us his 17 Bright Ideas for Tips To Improve Your Chances For Getting A Loan Approved:
- Remember – this is NOT financial advice so seek professional advice first.
Honesty – Don’t be tempted to tell little white lies in your loan application. Discrepancies have a habit of showing up, so always ensure you’re transparent and upfront. Saving patterns – Make sure you have 3-6 months’ worth of statements to show the bank manager that you’re sensible and sharp when it comes to money. This will reassure them that you won’t become a liability in the end. Credit rating – Arrears, defaults and bankruptcies will affect your rating. You can view your current credit rating (for free) here. Employment history – Ideally you’ve been steadily employed for at least three years when you make your loan application. If you’ve just started a job, obtain a letter from your employer to confirm your current job and probation status. Money owed – The bank has responsibility by law to ensure you can afford the proposed loan repayments. If your credit cards are maxed out and you owe money, this will go against you. It’s a good idea to cancel credit cards, where possible. Deposit amount – Most banks will loan up to 95% of the purchase price. But try to steer clear of this high ratio, you’ll be subject to stringent criteria. A 20% deposit is ideal and will mean that you avoid paying lenders mortgage insurance too. A guarantor – Using a family member’s property as additional security could reduce your overall loan-to-value ratio and increase your borrowing power at the same time. Do some homework before hand as there are a lot of strict terms and conditions that go with this type of arrangement. Choose the right lender – There is a huge variance on how much lenders will loan you. Each lender has their own set of credit policies and is suited to a different demographic. Research is important. Apply for the right loan – Applying for the right loan will increase your chances of approval. Each lender calculates borrowing power differently, depending on whether you borrow on an interest-only basis, principal and interest basis – or if you’re applying for a package loan. Put in a complete application – Leaving so much as your landline number can reduce your credit scoring. Credit assessors reduce the risk of decisions by taking a wide variety of factors into account. So, make sure you don’t miss a thing. Apply in good time – Most lenders on my panel can push through an approval within five business days (some as quickly as 4 hours). But it varies, therefore if you have an urgent loan request, opt for a lender who can accommodate this. Gain pre-approval – Going through the pre-approval process prior to committing your money might just save you a lot of money. It will also make you a more attractive buyer, as you have all your ducks lined up and ready. Beware of “indicative pre-approvals” however – in some cases, these aren’t worth anything at all. Keep your papers in order – Your bank will ask to verify your identity, income and savings by seeing evidence and documentation. Don’t make them wait. Stick to sensible living expenses – The bank calculates how much you can borrow using minimum living expense figures. If yours is above this figure, this may reduce your borrowing power. If your living expenses are high, take a look at which expenses are essential and which could be reduced or eliminated. Consolidate other debts – If you can roll any other debts you have into your home loan, this could reduce your repayments and subsequently increase your borrowing power. Budget for everything – When purchasing a property, you’ll be surprised at how many hidden costs there are along the way. Make sure you take every possible scenario into consideration, so you’re not left short come settlement day. Seek expert help – It can be overwhelming to tackle this alone. An experienced personal mortgage adviser, like myself, could take away the pain and the paperwork – so you can focus on finding your dream home. Best of all, I won’t cost you a cent because I’m renumerated by the lender.
- Shannon Ingram – Personal Mortgage Adviser – Award winning mortgage broker Shannon Ingram became a Smartline Personal Mortgage Advisor in 2010, after eight years working for a major Australian bank.
- Along with his wife, Shannon has bought and sold several properties. This gives him invaluable insight into his client’s experience. This resulted in Shannon winning the Smartline NSW/ACT Client Service Award in 2012. “I know from first-hand experience how stressful a time buying a property can be,” he said of his property purchases. “As a result, I always do my best to go above and beyond expectations and to do whatever is necessary to ensure a smooth process to get my clients into their new home.”
- With all of the choices available on the market, Shannon believes a quality mortgage adviser can hand-pick the most appropriate option for every individual situation. “The right loan is going to be one that meets all of my client’s needs – including, of course, interest rate and fees, but also things like service levels and loan features.”
- Managing the loan from start to finish enables Shannon to coordinate the best outcome between the client and the lender. He is happy to assist with any property purchase or refinancing arrangements.
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