When you’re planning on investing in property, there are a few things we need to know so that we can make sure all the numbers add up.
Simply, they are how much you earn, owe, own and spend.
Whilst I’m not a mortgage broker, financial planner or accountant, these figures will give us a good indication that you can service the debt, that the lender will see you as a good risk and to ensure our investment strategy works well with your financial situation.
For some, how much you earn will just be your wages. For others, it may dividends, interest, income from other investment properties, bonuses, etc.
How much you owe can include any existing mortgages, loans, finance on vehicles or other equipment, credit card debt and personal loans.
What you own can include property, vehicles, boats, valuable art or anything that can be sold to service the debt.
Your spending has become more important in recent times as the lenders are looking at this more carefully rather than taking an average. They will be asking for actuals rather than estimates, so it’s a good idea to get on top of your personal spending before it’s time to apply for a loan. There are some great apps that can automatically track and categorise your personal spending, so do a bit of research and see what works for you.
This all sounds pretty simple, but it does require some thought to get it all together.
So come prepared. These are the questions that you will need to know the answers for so that we can match you up with a property or properties that don’t put you under too much financial pressure and you’ll also be well prepared for when you need to see the mortgage broker, accountant and financial planner.
If the time is right for you to invest in property, we’d love to help.