When people are uneducated about the home loan process, they are much more likely to get a less than excellent deal. By sitting down and estimating what your borrowing power will probably be, you can eliminate surprises and be better able to spot any inconsistencies as well.
How Your Borrowing Power Is Determined -
When processing home loans Brisbane, mortgage brokers take a look at your overall financial situation to get a feel for how much you can afford - as well as your ability repay it. All too often, people start looking at home loans without having an inkling about where they truly stand financially. It's easy to live your day to day life without really thinking about your income versus your financial obligations - two things that brokers and loan officers look at the most closely. So, how is your borrowing power determined? A basic overview is outlined below.
Your Income -
The main thing a mortgage broker need to know in order to work out your borrowing power is your gross annual income. Your gross annual income is the total amount that you earned the previous year, prior to taxes. This information is needed because it is officially documented and the bank or lending institution can be fairly confident about its accuracy.
In addition to your gross annual income, your mortgage broker will want to know about other sources of income that you may have. These might include federal family assistance, rent income from investment properties that you own or income from investments. In the last case, you will need to provide two years' worth of proof about any dividends received over that period of time - not growth in share values.
Your Expenses -
Even if you make a rather substantial income, it can be offset significantly depending on what kinds of expenses you have. Sit down and take an unflinching look at what your expenses are. Mortgage brokers will look to see how many dependents you have; your credit card and store accounts and their limits; outstanding balances on personal, automobile or other loans; maintenance payments and rent payments - if you will need to keep paying rent.
From that information, your mortgage broker will be able to determine what your borrowing power is. To get a preview of what he will find, sit down and figure those numbers out for yourself. It's a great way to get an idea about what to expect when buying a home.
How Your Borrowing Power Is Determined -
When processing home loans Brisbane, mortgage brokers take a look at your overall financial situation to get a feel for how much you can afford - as well as your ability repay it. All too often, people start looking at home loans without having an inkling about where they truly stand financially. It's easy to live your day to day life without really thinking about your income versus your financial obligations - two things that brokers and loan officers look at the most closely. So, how is your borrowing power determined? A basic overview is outlined below.
Your Income -
The main thing a mortgage broker need to know in order to work out your borrowing power is your gross annual income. Your gross annual income is the total amount that you earned the previous year, prior to taxes. This information is needed because it is officially documented and the bank or lending institution can be fairly confident about its accuracy.
In addition to your gross annual income, your mortgage broker will want to know about other sources of income that you may have. These might include federal family assistance, rent income from investment properties that you own or income from investments. In the last case, you will need to provide two years' worth of proof about any dividends received over that period of time - not growth in share values.
Your Expenses -
Even if you make a rather substantial income, it can be offset significantly depending on what kinds of expenses you have. Sit down and take an unflinching look at what your expenses are. Mortgage brokers will look to see how many dependents you have; your credit card and store accounts and their limits; outstanding balances on personal, automobile or other loans; maintenance payments and rent payments - if you will need to keep paying rent.
From that information, your mortgage broker will be able to determine what your borrowing power is. To get a preview of what he will find, sit down and figure those numbers out for yourself. It's a great way to get an idea about what to expect when buying a home.
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