itegoa Posted March 1, 2016 Share Posted March 1, 2016 Hi, We're just trying to see how much we can lend for a home loan, and the calculators i've used show that we'll be allowed to borrow LESS money, if it's a joint application and if we have kids (dependants). I'm the only one earning ($100K) so i know how much we could afford to pay each month, but the calculators say it's less. I'm thinking a way around this is to apply for a home loan as a single application (just me) and say I have no dependants. Has anyone tried this? I'm not looking to overstretch us, but i'm 100% certain that I could afford to pay more each month than the calculators suggest. Quote Link to comment Share on other sites More sharing options...
buzzy--bee Posted March 1, 2016 Share Posted March 1, 2016 Personally I would not be attempting to obtain a loan by defrauding a lender, probably not the best way to go! Better to talk to a broker. BB Quote Link to comment Share on other sites More sharing options...
Sammy1 Posted March 1, 2016 Share Posted March 1, 2016 Hi, We're just trying to see how much we can lend for a home loan, and the calculators i've used show that we'll be allowed to borrow LESS money, if it's a joint application and if we have kids (dependants). I'm the only one earning ($100K) so i know how much we could afford to pay each month, but the calculators say it's less. I'm thinking a way around this is to apply for a home loan as a single application (just me) and say I have no dependants. Has anyone tried this? I'm not looking to overstretch us, but i'm 100% certain that I could afford to pay more each month than the calculators suggest. I am a single parent and yes, the number of dependents is taken into account. In general, the calculators are pretty good, I pay what I can afford and still live well. My mortgage broker helped me with the right loan. My suggestion would be to find yourself a good broker and not to over extend yourself. You have to be careful when there is only one income. Quote Link to comment Share on other sites More sharing options...
Cerberus1 Posted March 1, 2016 Share Posted March 1, 2016 Send @Adam from Vista Financial a msg, he should be able to advise you re your maximum borrowing capacity etc. Quote Link to comment Share on other sites More sharing options...
LKC Posted March 1, 2016 Share Posted March 1, 2016 Talk to a broker, we did and negotiated a good deal through them. It will help if you have a good deposit. The reason you can borrow less if you have more dependents is that you have more pressure on your salary. Say you get a bunch of unexpected bills one month (the cat needs $5000 of vet treatment, you spent a bit more than usual entertaining because you have family over for a holiday, and it is the start of the school year so you have to fork out for uniforms, books and other stuff times two kids - all things that have happened to us) and that is why the calculators err on the side of caution. In the good months you will have no trouble, but not every month will be a good month. There is always something unexpected just around the corner. Quote Link to comment Share on other sites More sharing options...
CaptainR Posted March 1, 2016 Share Posted March 1, 2016 I'd also echo the above, a good broker will be able to help personalise the applications, will know what the different lenders accept and almost certainly will get you a better rate then direct with the lenders. Quote Link to comment Share on other sites More sharing options...
Guest The Pom Queen Posted March 1, 2016 Share Posted March 1, 2016 I also agree to chat with Adam or Andrew Quote Link to comment Share on other sites More sharing options...
AJ Posted March 1, 2016 Share Posted March 1, 2016 Thing is when the banks are making sure you can afford the amount they give you its a fault, but if they threw money at you that you couldnt afford to pay back that would be their fault too! Am talking about in general not just the OP. Quote Link to comment Share on other sites More sharing options...
Que Sera Sera Posted March 1, 2016 Share Posted March 1, 2016 Thing is when the banks are making sure you can afford the amount they give you its a fault, but if they threw money at you that you couldnt afford to pay back that would be their fault too! Am talking about in general not just the OP. Absolutely this :notworthy: Quote Link to comment Share on other sites More sharing options...
CNC FABS Posted March 1, 2016 Share Posted March 1, 2016 When I was last playing with figures on the NAB website. It was also plain to see how they penalise you with a lower lending amount, when you want to pay it over a shorter period ! Quote Link to comment Share on other sites More sharing options...
Parley Posted March 1, 2016 Share Posted March 1, 2016 Isn't it reasonable to consider all your outgoings in determining how much you can afford to repay. More children means more expenses. I wouldn't really call it penalising. It is a good thing to only borrow the amount you can comfortably service. Quote Link to comment Share on other sites More sharing options...
NicF Posted March 1, 2016 Share Posted March 1, 2016 When I was last playing with figures on the NAB website. It was also plain to see how they penalise you with a lower lending amount, when you want to pay it over a shorter period ! That because the repayments will be higher when you are paying it back quicker so if you can afford to pay back $5000 a month this will allow you to borrow much less if you are paying a mortgage back over 15 years than it would if you were paying back over 30 years. If you choose a flexible mortgage that allows over payments you will be able to borrow the amount that you can get for over 30 years but make additional payments each time so you end up paying the mortgage back much sooner. This is what we are doing - our mortgage is over 30 years but we repay extra each fortnight and we are now down to just over 20 years left on the mortgage even though we have only had it for just over 2 years. If we can keep paying it off as we are at the moment we should actually have it paid off in 15 years. Quote Link to comment Share on other sites More sharing options...
Parley Posted March 1, 2016 Share Posted March 1, 2016 When I was last playing with figures on the NAB website. It was also plain to see how they penalise you with a lower lending amount, when you want to pay it over a shorter period ! There is no point in doing that. Take the loan out over the maximum period, but as a variable rate loan you can pay it off as fast as you like. You don't want to lock yourself into a short loan with high repayments in case your circumstances change. Quote Link to comment Share on other sites More sharing options...
itegoa Posted March 2, 2016 Author Share Posted March 2, 2016 There seems to be a massive difference just by adding on wife + 2 kids to the application. IIRC, the figure were something like this. Single applicant (me): they will lend $587K. Joint application with kids (wife + 2 kids): they will lend $367K :eek: If they could just lend me $400K that would be nice! (we'll have a 140K deposit). Think it'll be best if I speak to a broker Quote Link to comment Share on other sites More sharing options...
Marisawright Posted March 2, 2016 Share Posted March 2, 2016 There seems to be a massive difference just by adding on wife + 2 kids to the application. Well duh, obviously there would be, since they're taking into account the living costs of four people people instead of just one. They are also basing their calculations on a typical family - perhaps you are more frugal than the typical Aussie family but how do they know that? Quote Link to comment Share on other sites More sharing options...
itegoa Posted March 2, 2016 Author Share Posted March 2, 2016 Well duh, obviously there would be, since they're taking into account the living costs of four people people instead of just one. They are also basing their calculations on a typical family - perhaps you are more frugal than the typical Aussie family but how do they know that? Well yes they are (basing it on a typical family). And yes I am (more frugal). They don't know that. Will they listen if I tell them? Or will it be a case of "computer says no". As others have suggested, go see a broker. Quote Link to comment Share on other sites More sharing options...
Marisawright Posted March 2, 2016 Share Posted March 2, 2016 Well yes they are (basing it on a typical family). And yes I am (more frugal). They don't know that. Will they listen if I tell them? Or will it be a case of "computer says no". . Think about it - why should they believe you? The bank doesn't have time to investigate the personal life situation of individual families - of course they have to rely on statistics. Besides, even if they did base the loan on your current circumstances, how do they know you won't decide to send your kids to private school, or buy a bigger car, in later years? The banks copped a lot of flak for lending too generously in previous years, so now they're erring on the safe side. Quote Link to comment Share on other sites More sharing options...
NicF Posted March 3, 2016 Share Posted March 3, 2016 Well yes they are (basing it on a typical family). And yes I am (more frugal). They don't know that. Will they listen if I tell them? Or will it be a case of "computer says no". As others have suggested, go see a broker. When we were applying for our mortgage we had to provide a breakdown of our outgoings, presumably to show we could afford the mortgage repayments for the mortgage we were asking for. We did build though so we were having to make payments while still paying rent (although the payments were interest only). Quote Link to comment Share on other sites More sharing options...
Paul1Perth Posted March 3, 2016 Share Posted March 3, 2016 The last GFC was in part caused by people borrowing too much and not being able to pay it back. I would rather the banks be on the cautious side. Keeps the house prices down too. Quote Link to comment Share on other sites More sharing options...
Johndoe Posted March 3, 2016 Share Posted March 3, 2016 Frugal wouldn't cut it anyway. The extras for the wife and kids is consideration not only for everyday "housekeeping" but they factor in more use of utilities, second car and it's associated costs as most families here run two vehicles, schooling costs, 3 more lots of clothing, and a myriad of other things that the average punter likely wouldn't think about when going into debt. Quote Link to comment Share on other sites More sharing options...
Andrew from Vista Financial Posted March 6, 2016 Share Posted March 6, 2016 Hi itegoa Yes having children will reduce borrowing power as lending is based on your ability to repay the loan having taken your income and expenses into account. However lenders do not all apply the same calculation across the board and therefore some lenders will lend more than others. If you would like to message me I can let you know what your borrowing power is based on your individual circumstances as I have software that goes out to about 30 different lenders. Regards Andy Quote Link to comment Share on other sites More sharing options...
Sustain Posted March 7, 2016 Share Posted March 7, 2016 Hi, We're just trying to see how much we can lend for a home loan, and the calculators i've used show that we'll be allowed to borrow LESS money, if it's a joint application and if we have kids (dependants). I'm the only one earning ($100K) so i know how much we could afford to pay each month, but the calculators say it's less. I'm thinking a way around this is to apply for a home loan as a single application (just me) and say I have no dependants. Has anyone tried this? I'm not looking to overstretch us, but i'm 100% certain that I could afford to pay more each month than the calculators suggest. The calculators are there as a guide Brokers will establish more refined details for example: If you own outright your motor vehicles You don't drink or smoke Your focus is on reducing the loan over next 5 years (versus interest only!) As BB said don't play with mis information, always play with straight bat. Quote Link to comment Share on other sites More sharing options...
Steve99 Posted March 9, 2016 Share Posted March 9, 2016 Regardless of this particular issue the banks are lending insane amounts of money in order to keep house prices increasing. The very same banks will often lend more through a broker so that they can distance themselves from any potential fallout and brokers are not adverse to bending the truth a bit or occasionally a lot. Quote Link to comment Share on other sites More sharing options...
Guest Posted March 9, 2016 Share Posted March 9, 2016 Regardless of this particular issue the banks are lending insane amounts of money in order to keep house prices increasing. The very same banks will often lend more through a broker so that they can distance themselves from any potential fallout and brokers are not adverse to bending the truth a bit or occasionally a lot. Indeed when it came to signing our mortgage agreement our broker had failed in disclose the 'buy to let' property we had in the UK was mortgaged - presumably because he knew there was no way they could actually check. Mind you that particular broker was absolutely unscrupulous - told us we could use the first home owners grant as part of the deposit and then when the first payment was to be made on the build we found out the grant wasn't paid until the slab was down. Luckily our builder was understanding but I was literally in tears in the bank - the broker wasn't interested! In fact due to our lack of knowledge the broker left us broke! A very different experience to working with an independent financial advisor in the UK - although maybe we just had a good one on the UK and a bad one in Australia. If anyone wants to know who to avoid in Perth PM me Quote Link to comment Share on other sites More sharing options...
Beaty Posted June 17, 2016 Share Posted June 17, 2016 Hi, We're just trying to see how much we can lend for a home loan, and the calculators i've used show that we'll be allowed to borrow LESS money, if it's a joint application and if we have kids (dependants). I'm the only one earning ($100K) so i know how much we could afford to pay each month, but the calculators say it's less. I'm thinking a way around this is to apply for a home loan as a single application (just me) and say I have no dependants. Has anyone tried this? I'm not looking to overstretch us, but i'm 100% certain that I could afford to pay more each month than the calculators suggest. Dude, of course you're going to be penalised for having 'a wife and kids'. A wife and kids costs! Disposable income is obviously depleted by have the aforementioned. B Quote Link to comment Share on other sites More sharing options...
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