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Home Financed Through CCSLending

๐‡๐จ๐ฐ ๐จ๐ฅ๐ ๐ข๐ฌ ๐ญ๐จ๐จ ๐จ๐ฅ๐ ๐Ÿ๐จ๐ซ ๐š ๐›๐š๐ง๐ค ๐ญ๐จ ๐ฌ๐š๐ฒ ๐ง๐จ ๐ญ๐จ ๐ ๐ข๐ฏ๐ข๐ง๐  ๐ฒ๐จ๐ฎ ๐š ๐ก๐จ๐ฆ๐ž ๐ฅ๐จ๐š๐ง/๐œ๐ซ๐ž๐๐ข๐ญ?

March 21, 2024โ€ข3 min read

  • ๐‚๐š๐ง ๐ˆ ๐š๐ฉ๐ฉ๐จ๐ซ๐ญ๐ข๐จ๐ง/๐ฌ๐ฉ๐ฅ๐ข๐ญ ๐ฆ๐ฒ ๐๐ž๐›๐ญ ๐จ๐ซ ๐ฅ๐ข๐ฏ๐ข๐ง๐  ๐ž๐ฑ๐ฉ๐ž๐ง๐ฌ๐ž๐ฌ ๐ฐ๐ข๐ญ๐ก ๐ฆ๐ฒ ๐ฌ๐ฉ๐จ๐ฎ๐ฌ๐ž ๐ญ๐จ ๐ก๐ž๐ฅ๐ฉ ๐ฆ๐ž ๐›๐จ๐ซ๐ซ๐จ๐ฐ ๐ฆ๐จ๐ซ๐ž?

  • ๐ƒ๐จ ๐ฆ๐ฒ ๐ฉ๐ž๐ญ๐ฌ ๐œ๐จ๐ฌ๐ญ ๐ฆ๐ž ๐ฆ๐ฒ ๐›๐จ๐ซ๐ซ๐จ๐ฐ๐ข๐ง๐  ๐œ๐š๐ฉ๐š๐œ๐ข๐ญ๐ฒ?

  • ๐๐š๐ ๐œ๐ซ๐ž๐๐ข๐ญ?

  • Does HECS affect my borrowing capacity?

๐“๐ก๐ž๐ฌ๐ž ๐š๐ซ๐ž ๐ฌ๐จ๐ฆ๐ž ๐จ๐Ÿ ๐จ๐ฎ๐ซ ๐ฆ๐จ๐ฌ๐ญ ๐ฉ๐จ๐ฉ๐ฎ๐ฅ๐š๐ซ ๐ฅ๐ž๐ง๐๐ข๐ง๐  ๐ช๐ฎ๐ž๐ฌ๐ญ๐ข๐จ๐ง๐ฌ ๐ญ๐ก๐ข๐ฌ ๐ฐ๐ž๐ž๐ค.

โœ…๐‡๐„๐‚๐’ (๐ก๐ข๐ ๐ก๐ž๐ซ ๐ž๐๐ฎ๐œ๐š๐ญ๐ข๐จ๐ง ๐œ๐จ๐ง๐ญ๐ซ๐ข๐›๐ฎ๐ญ๐ข๐จ๐ง ๐ฌ๐œ๐ก๐ž๐ฆ๐ž).

YES. Your HECS debt will have a negative impact your borrowing capacity. HECS repayments are calculated based on your gross annual income before tax not on the remaining/outstanding balance of your HECS. Your HECS balance can be a little as $500 or as higher as $50,000, the monthly repayments will still be the same.

โœ… ๐€๐ฉ๐ฉ๐จ๐ซ๐ญ๐ข๐จ๐ง๐ข๐ง๐  ๐š ๐ฃ๐จ๐ข๐ง๐ญ ๐๐ž๐›๐ญ ๐จ๐ซ ๐จ๐ง๐ ๐จ๐ข๐ง๐  ๐œ๐จ๐ฆ๐ฆ๐ข๐ญ๐ฆ๐ž๐ง๐ญ๐ฌ.

YES. On a case by case and bank by bank basis. If youโ€™re in a spousal relationship and if both you and your spouse can demonstrate to the bank that your spouse, who is not a party to the proposed loan, can service their own portion of the existing liabilities. Household living expenses including childcare and private school fees etc. cannot be apportioned.

โœ… ๐๐จ๐ง๐ฎ๐ฌ ๐š๐ง๐ ๐ง๐จ๐ง-๐›๐š๐ฌ๐ž ๐ข๐ง๐œ๐จ๐ฆ๐ž (๐š๐ฅ๐ฅ๐จ๐ฐ๐š๐ง๐œ๐ž๐ฌ, ๐จ๐ฏ๐ž๐ซ๐ญ๐ข๐ฆ๐ž, ๐ฌ๐ก๐ข๐Ÿ๐ญ ๐š๐ฅ๐ฅ๐จ๐ฐ๐š๐ง๐œ๐ž, ๐…๐ˆ๐…๐Ž, ๐–๐€๐…๐‡).

80% of your bonus income can be included as part of the borrowing capacity calculations but only if you can demonstrate consistency of this income for two previous years.

Meaning if received $1,000 in bonus payment in FY23. Then $800 can be used for servicing.

Essential allowances such as working away from home, fly-in fly-out, uniform allowance, car allowance, shoe allowance, shift allowance can all be considered of up to 100% on a bank-by-bank basis.

โœ… ๐‹๐ข๐ฏ๐ข๐ง๐  ๐š๐ญ ๐ก๐จ๐ฆ๐ž ๐ฐ๐ข๐ญ๐ก ๐ฉ๐š๐ซ๐ž๐ง๐ญ๐ฌ ๐ซ๐ž๐ง๐ญ-๐Ÿ๐ซ๐ž๐ž.

If youโ€™re living at home with your parents rent-free, then the bank will automatically factor in $650 per month as your rental expense. This known as โ€œnotional rentโ€.

โœ… ๐๐š๐ ๐œ๐ซ๐ž๐๐ข๐ญ (๐œ๐ซ๐ž๐๐ข๐ญ ๐ข๐ฆ๐ฉ๐š๐ข๐ซ๐ฆ๐ž๐ง๐ญ).

Can be considered on a case by case and lender by lender basis. Your loan to value ratio would need to be 80% or less.

But how bad is bad? How does a bank/lender determine an applicantโ€™s credit worthiness? I will cover this topic on my next post.

โœ… ๐ƒ๐จ๐ž๐ฌ ๐š๐ ๐ž ๐ฉ๐ฅ๐š๐ฒ ๐š ๐›๐ข๐  ๐ฉ๐š๐ซ๐ญ ๐ข๐ง ๐ฅ๐ž๐ง๐๐ข๐ง๐ ?

Yes and No. Banks and non-bank lenders do not have age discrimination or restrictions, it is all about sound exit strategy.

A sound exit strategy pretty much interpreted as what can the borrower do to repay the loan back in full without needing to sell their principal place of residence or being in financial hardship.

Even though most Banks say that they donโ€™t have age restrictions, but they tend to favour younger individual borrowers based on the assumption that younger borrowers have a longer working life.

For example: a 60-year-old borrower would potentially stop working within 5 years from the date of obtaining the loan vs a borrower in their 30s.

โœ… ๐Ÿ ๐ฒ๐ž๐š๐ซ ๐ฌ๐ž๐ฅ๐Ÿ-๐ž๐ฆ๐ฉ๐ฅ๐จ๐ฒ๐ž๐ ๐ข๐ง๐œ๐จ๐ฆ๐ž ๐ฏ๐ž๐ซ๐ข๐Ÿ๐ข๐œ๐š๐ญ๐ข๐จ๐ง.

On a case by case and bank by bank basis. Major banks can consider one year income documents to verify a self-employed applicantโ€™s income.

Traditionally 2 years financials are required by all lenders. Although there still a lot of the banks out there that still requesting for 2 years income documents.

โœ… ๐ƒ๐จ ๐ฆ๐ฒ ๐ฉ๐ž๐ญ๐ฌ ๐œ๐จ๐ฌ๐ญ ๐ฆ๐ž ๐ฆ๐ฒ ๐›๐จ๐ซ๐ซ๐จ๐ฐ๐ข๐ง๐  ๐œ๐š๐ฉ๐š๐œ๐ข๐ญ๐ฒ?

YES, absolutely. Your pet expenses will form part of your overall household living expenses.

Your children under the age of 18 and spouse who are financially dependent on your financial support will also add a negative impact to your borrowing capacity.

๐€๐ฌ always, ๐ข๐Ÿ ๐ฒ๐จ๐ฎ ๐ก๐š๐ฏ๐ž ๐š๐ง๐ฒ ๐จ๐ญ๐ก๐ž๐ซ ๐ช๐ฎ๐ž๐ฌ๐ญ๐ข๐จ๐ง๐ฌ feel free to reach out to one of our team members at CCS Lending.

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