When lenders assess your application they will want to see that you have Repayment Capacity. This means you are able to prove to the lender that you can easily meet the repayments for the proposed loan.
Each month you are required to prove that you have saved an amount equal to the expected repayments for the proposed loan. This amount can be a combination of saved funds and consistent rental payments. The lender will generally look back over 6 months of savings account statements and rental ledgers.
It is a good idea to have a separate savings account which you consistently add to each month. This will make it easier for you to monitor your savings and for the lender to identify Repayment Capacity has been met.
If you are renting, ensure rental payments are always made on time or in advance. A rental ledger from your letting agent and bank statements will be required from the lender to prove rental payments have been consistently met.
If you are thinking about purchasing a new home and would like more information regarding Repayment Capacity or have any other questions please contact us at Territory Loans.
