At Awesome Lending Solutions, we have seen a big change in the market conditions, with the recent changes to the investment market and rates still at record lows; Australia is currently experiencing a huge change in what people can borrow. It is an awesome climate for both first home buyers and investors, so much so that you may be able to buy a property now that you maybe could not afford six months ago with the higher interest rates. However, just because the professional woman can borrow more doesn’t necessarily mean the Bank will approve her loan application. Loans for young professionals and at times particularly loans for women who may be just starting or just returning to a career can be challenging. There are many reasons her loan may be rejected. A Bank may turn down her loan application even if on face value the financial side of the loan seems to stack up. At Awesome Lending Solutions, here are the main reasons we see loans being rejected and our tips on improving your chances of being accepted:
You Have A Poor Or Low Credit Score Or Maybe Even Defaults
Missed or late bill repayments will show up on your credit file, and these can adversely affect your chances of getting a home loan. Even that disputed mobile phone bill from 5 years ago can come back to haunt you. Ensure your bills are paid on time and resolve any past disputes quickly. At Awesome Lending Solutions, we can check your credit file to avoid any potential embarrassment.
You Have Bank Statements Showing Multiple Incomes And Varying Spending Habits.
We have come across many successful professional women who prefer to take on various consultancy roles as opposed to being committed to one employer or move within an industry quite regularly. While you know why you have three different employers in the year the Bank does not and will assume that it denotes instability in employment. This type of employment history tends to lead banks to examine your income in detail, as well as your living expenses, and other financial commitments slightly more critically when they evaluate how much they think you can afford to borrow. Every woman should develop a budget to work out how much they think they can afford, and when you preparing the budget don’t forget to include in the budget incidentals (we all like a bit of retail therapy) even that morning coffee to give you a realistic picture of how you spend your money. This will help ensure your income is sufficient to meet potential home loan repayments. Please Contact Awesome Lending for a copy of our budget calculators to assist you with this.
When The Story Of Your Savings History Is Clear
You have your deposit covered as well as a great job and income to meet your monthly commitments, but the bank might still say ‘No’ based on your savings history. It is important to be ready to demonstrate to your Bank or Broker how you accumulated your deposit. This will help them see that you are capable of managing your finances and meeting commitments with a savings plan. Often this could be as simple as setting up a separate account where you have a set amount of funds being deposited on a regular basis.
You Just Have Enough Money Put Together For The Deposit
While the savings plan can help, this can be hard; it is often tempting to dip into your savings for the latest sale or holiday with friends. Think about ways of locking money into accounts that have time delays on withdrawals such as term deposits. While you don’t want to put your life on hold, banks have minimum deposit requirements and depending on the property and application you may be required to have more. Why not talk to Awesome Lending Solutions about the size of the deposit that you would need before you apply for the loan.
You Have Fallen In Love With A Property, But The Bank Does Not Feel The Same Way
It might be the property of your dreams, but things like the size, location, and presentation are all things the Banks will look at. For example, some banks won’t lend in certain post codes of if they think the apartment is just too small and won’t satisfy the bank’s requirement. You can avoid this by obtaining a property report from Awesome Lending Solutions for the property you are interested in to make sure it is acceptable for a loan. Are You Credit Ready? The secret when applying for any loan is that it’s like any good dinner party; you need to prepare well in advance. This means having all your financial information up to date, with clear investment goals and projections for the next 3 -5 years. Show the lender that you have given a lot of thought into purchasing your next property and how you intend to manage your finances so you are considered a ‘safe risk’.