How to look good to your lender

By Aidan Devine | 23 Apr 2012


Question: I currently own an investment property and am eager to start picking up more. I’m hoping to buy a few houses fairly quickly to take advantage of some of the low prices at the moment, there’s just one problem: I’ve recently become self-employed and worry about my ability to get finance. The business is going well and I’ve just landed a $300,000 contract, but it’s barely been four months since the business was started. 

I want to get investing straight away. Is there anything I can do to reassure the bank that I am safe pickings for extending a line of credit? 

Answer: It’s great that your business is going well and you’ve landed a large contract, but most lenders are looking for a history of consistent income.  The lenders will assess your application for credit based on serviceability, equity, credit history (i.e. no defaults) and risk factors.  

I recommend you select a savvy finance broker that has affiliations with all the major lenders as well as second tier lenders. A finance broker will be able to quickly assess your personal situation and identify the most suitable lender.  

You’re running a business and you should give that your major focus. Leverage out the time consuming task of finding finance to a broker. My company uses hand picked brokers that deliver great customer service and that understand clients that want to buy multiple properties to build a portfolio. They put the first few loans with the tougher lenders first, then as serviceability tightens up, subsequent loans are put with lenders with more relaxed criteria. 

 As you’re self employed, some banks have a minimum period of operation or they may require you to go as personal guarantor. With your existing bank you can offer to provide them updated management accounts and a letter of support from your accountant. In the end, you are best off using a smart finance broker to do the running around for you. 

  • Answer provided by Rich Harvey (

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