Investors are constantly looking to grow their portfolios, so what can you do when the bank says you don't have any equity? Here's our real-life scenario where we found a solution.
Mr George* owned several investment properties and was keen to continue growing his portfolio, so he did what most people would do and approached his current lender to enquire about his borrowing capacity.
While he had been a loyal customer with a great payment history, the bank advised that their internal assessments showed he didn’t have enough equity in his current properties to borrow any more.
When Mr George pressed the issue, knowing full well that his investments had grown in value, the bank advised they would consider a change in their assessment only if a full application process was completed for each of his several investment properties.
The Bank Wanted:
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A full application completed for each investment property (meaning multiple credit checks completed) |
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Payment of an application fee for each property except his principal residence (several hundred dollars) |
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Payment of fees for formal valuations on each property (also several hundred dollars) |
Mr George felt that to complete multiple applications, have his credit score impacted, and pay fees into the thousands just to investigate his borrowing capacity wasn't an option.
Additionally, he was looking to continually assess his position as potential investment opportunities arose. Going through this process each time would be not only costly, but completely unviable as it would drive his credit score down.
Following some internet sleuthing, Mr George came across GFS as a local mortgage broker and got in contact to see if we could assist.
We Secured:
| Free valuations on all the investment properties from several lenders | |
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A clear picture of his equity position at no cost, without a formal application or credit hits |
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Additional funding to continue to expand his property portfolio, which we will continue well into the future. |
There is no prize for loyalty in lending, in fact you may be missing out on opportunities by sticking to just one lender and taking their word for it on equity and borrowing capacity.
It pays to have a broker on your side to be able investigate your options, luckily you can get in contact with us today.
*name has been changed to protect our client's privacy.