Guarantor Loan for Investment Property

I am an Australian expat working in the Middle East looking to acquire my next property through a guarantor loan (preferably 105%). I have a wife and one child. My current facts and figures:

Current Investment Properties

Property valued at 330k, 214k owing (interest only), rental income $250/week
Property valued at 285k, 256k owing (interest only fixed for three years), rental income $310/week

Line of Credit – 49k limit, 48.5k owing

Credit cards

Australia – 9k limit, $700 owing
Middle East – 9.6k limit,6.8k owing (A$ equivalent)

Income

Full-time – 71k p.a. (A$ equivalent)
Part-time – 8k p.a. (A$ equivalent)

Note that these income figures are after tax (no income tax). After living expenses, I manage to send back A$3000 per month to Australia (I can demonstrate this). Been in my current job for over five years.

Guarantor details

Property worth 350k approx, no mortgage.
Owner (mother-in-law) is retired aged mid 50s.


Based on this information, what are the chances of getting approval for a guarantor loan for an investment property? Also what value of property? I am hoping to buy something in the 500k range with 105% LVR (100% would be possible, but 105% is preferred), probably in Queensland where something neutral to cash flow positive is possible (at 105% LVR).

[Tina Pham]

Hi Murah,

Your chances are looking really good with the help of a Guarantor. It is important to note that not all lenders will accept a retired guarantor so this is something we have to take into consideration when finding the right lender for you.

Another issue will be the affordability side of things as we will have to factor in living expenses for you and your wife separately. Some lenders will include a nominal rent even though you may not be paying any. If the property you are purchasing is neutrally or positively geared as per your notes then this should help servicing.

There are also other ways to increase your borrowing power so i recommend you call us so we can do a full assessment and confirm the maximum amount you can borrow.