6 Crucial Things You Need For Your Loan Application
Dilleen Property Group 2022
A major component of property investing is acquiring finance to fund the property. When applying for finance, the bank will perform thorough checks on your details to ensure that you are eligible for a loan. It is important to prepare for these checks to help the process run as smoothly as possible.
Here is the list of things you will need when applying for a loan:
1. Identity Documents
When applying for finance, you will need to have 100 points of ID with you. This generally includes your driver’s license and passport, however, if you do not have these, you can also use your Medicare Card, Birth Certificate and Marriage Certificate.
2. Pay Slip
The next things you will need are your pay slips and paychecks from your employer. This includes the two most recent payslips. However, if you also have commissions, bonuses and overtime payments, you will have to provide additional payslips, PAYG summaries or income tax statements.
3. Proof of savings
There are two types of savings - Genuine savings and Non-genuine savings. Genuine savings refer to the savings that have been accumulating at a steady rate for at least a 3-month period whereas non-genuine savings refer to one-off payments received from gifts or lump sum payments without a history of saving over time. Lenders prefer seeing genuine saving capacities especially if you are using a lender’s mortgage insurance.
4. Statements
This includes everyday living expenses statements so lenders can understand your spending habits and see if there is evidence of using Zip Pay and Afterpay services. High budgets and expenditures on different things will hurt your loan application. You will also need to provide statements for credit cards, car loans, home loans and personal loans, hence you should ensure there are no late payments to maintain a good credit history.
5. Rate notices
If you are a property owner, you will need to provide rate notices for confirmation. Additionally, you will have to provide your rental income statements from your property managers to confirm the amount of rent you receive each week, as well as a copy of your lease.
6. Business Registration
If you are self-employed or you own your own business, you will need to have your business registered for 2 years and have 2 years of completed financials. This includes having two years record of business tax returns and notice of assessment. Some lenders are more lenient and will only require 12 months of financial details which is useful if the pandemic has affected your business.
Finally, if you require assistance or have an inquiry about acquiring a loan, you can contact our recommended broker Justin Picker to learn more on this topic.
Disclaimer: This is not intended as legal, financial, or investment advice and should not be construed or relied on as such. Before making any commitment of a legal or financial nature, you should seek advice from a qualified and registered legal practitioner or financial or investment adviser.
