W Financial are cutting edge mortgage strategists, who specialise & are passionate about property investment... It’s run by award winning broker and successful investor Michelle Coleman. They’ve written over $500 million dollars in investor loans and the company maintains a stellar reputation, as group of intelligent, proven mortgage strategists, with Michelle at the helm helping investors start, maintain and grow their property portfolios... To learn more from W Financial and to find out how they can help you, visit WFinancial.com.au or call today on 1300 891 714
To become a property investor to be reckoned with its crucial that you put in place solid foundations first – much like with anything in life. In terms of being a successful property investor we know that one for the most crucial things you can do is improving and securing your financial position. In doing so you become an ideal candidate for lender approval, so your success in securing the best possible loan scenario for your loan(s) will be greater.
Here’s a checklist to keep in mind in order to improve your financial position:
1. Credit Scoring
Your personal credit file is updated by credit providers when you apply for credit. Potential lenders will use your file to assist them in deciding whether or not your application should be approved and therefor give you access to the capital you need to invest. By being informed you can more proactively manage your credit file and thus improve your chances of obtaining credit when you need it. We advise that you monitor your credit file by signing up for “My Veda Alerts.” To do this visit MyCreditFile.com.au for more info.
2. Avoid Late or Overdue Payments
We’re all human! Life happens; it’s not uncommon that we all get caught up in the hustle and bustle and forget to do certain things in one area of our lives whilst looking after the other. One area we really stress you stay on top of is paying your bills on time. When you pay bills late, or even default due to simple forgetfulness is when black marks will start appearing on your credit file. In fact what you may not have known is that paid defaults remain on your file for 5 years whilst leaving a bill unpaid altogether stays there for 7 years! The hard part is that your credit file doesn’t leave room for discretion… Miss a bill, default on a payment whether you’re moving house or loved one is in the hospital and your attention (and finances are needed elsewhere), or any other reason and the black mark goes on regardless. Do your best to be organised and discuss forgotten bills with creditors sooner rather than later!
3. Make Sure Your Experts Are In Fact… Experts. Then – Trust Them!
everything is wonderful, sadly a textbook only takes a student so far. What you want is a master of experience
looking after anything of yours that’s tied to your financial journey. We highly encourage you to build your mastermind team with experienced investors – we’re talking your financier, accountants, solicitors, and mentors. Be around the people who have influence on your investment choices and strategies who in fact have made and executed successful ones themselves that you can confidently glean from as a result. Don’t be afraid to ask either; we always find the best experts are those who aren’t shy of honesty when it comes to their journey. They’re the kind of people who are happy for you to learn from their successes, but also their collection of dead ducks (trust me, we all have them).
Once you have this team then start soaking up their guidance. There is definitely no shortage of advice and information available to investors; the critical thing to keep in mind is that not all of it will apply to your personal situation. Your team should be clear on your
goals, and able to use their expertise, and knowledge gained from practical experience to create a strategy to get you on the way to achieving them.
4. Be Patient With Timelines
The loan application process can take time. Whilst there are typical turnaround times for all the different stages, it’s not uncommon that speed bumps slow the process. This is normal because everybody’s life, finances, money choices are unique; to push finance through lenders need to cross all T’s and dot all I’s - often several times over.
5. Stay On Top of Your Paperwork
Lenders are particular about what they want from you. Remember they’re working out whether to give a stranger cheque for 6 or 7 figures. They want to see things like recent pay slips, bank statements, ID, and rental statements. At W Financial, we will always be as upfront as possible and give you a full list of everything your prospective lender may ask for – all good brokers will have this practice. But don’t be shocked if they come back wanting just that little bit more information!
Note that this is especially important if you are self-employed! Lenders will want to see tax statements and accounts that prove you earn what you claim to. The more evidence that you can provide to verify your financial position the better.
6. Maintain Stable Employment
Lenders need to know that you’ve got to a reliable source of income behind you. They won’t consider your application as favourably if you’ve changed employers every few months.
7. Save, Save, Save
Typically speaking, you will need to save at least 5% of the purchase price of a property before any lender will consider your application. They also want to see that you have been saving consistently over a decent period of time. A good baseline to shoot for is at least 3 - 6 months.
8. Be Nice to Your Finance Strategist!
This is more important than you might think. If you’ve got your mastermind team squared away, your finance strategist will have a great deal of experience, invaluable contacts, and an intimate knowledge of lending policy. Behind the scenes they’ll really battle it out for you when they need to, to do everything for you from your corner to make sure that your finance gets pushed through. Keep in mind that quite often the grit of the ‘trench work’ that happens after you’ve worked on your finance strategy together and collated all your evidence stays behind the scenes because they want to keep your stress levels to a minimum. Keeping your lines of communication open and respectful is a must from both sides.
If you’d like to learn a little more about the lending process then we have just the gift for you! If you visit us here you can grab a copy of our FREE eBook “What Every Investor Must Know Before You Choose A Lender.” However you’d like to just get in contact and talk to us about your financial journey, feel free to contact us here.
Disclaimer: information supplied by W Financial. While due care is taken, the viewpoints expressed by contributors and/or sponsors do not necessarily reflect the opinions of Your Investment Property.
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