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investment loan street
Investment: A term with several closely-related meanings in finance and economics. It refers to the accumulation of some kind of asset in hopes of getting a future return from it.
Below, you'll find valuable information on leading
investment loan street articles and products to help you on your way
to success.
Getting that Property Investment Mortgage Loan Offer Quickly
By Mark P Harrison
One of the things that the investor can offer the house-seller is speed of
purchase, and in some circumstances seller may be more intersted in this than in
the highest price for the house.
In order to deliver on this promise, you need the right team in place, and
the right paperwork in place - the joy of administration.
When prices are booming, lenders are desperate to lend money, and willing to
sometimes turn a blind eye to the odd lapse in paperwork. Once prices look like
stabilising, or there is a rumour of a price decline, then lenders typically
over-react by asking for more and more backup information to support your loan
application.
For the experienced investor this is seldom, if ever, a problem, since after
a few properties, we end up setting up more formal filing systems. For the new
investor, however, it can come as a sudden shock to be asked to produce odd bits
of paperwork that, in the past, might have been thrown (or shredded.)
If you are intending to apply for finance, you should ensure that you have
the following to hand before you go to see your mortgage broker:
Two years worth of bank statements (most lenders will only ask for 3-6
months, but sometimes lenders ask for more.) These bank statements should show
an income to match the income you claim to have (!) and proof that you have made
payments on your existing mortgage(s) without problems.
Mortgage statements on your own house for the last two years. Again some
lenders may ask for a rather shorter time period, but some ask for more
paperwork, and the requirements for paperwork are only going up at the moment.
At least 3 months worth of payslips from the same employer, and the P60 (UK
tax form) from your last tax year. In addition, some lenders may wish for a
letter from your employer outlining what income is guaranteed, and what is
subject to performance (either yours, or your employers), and confirming that
you are not under threat of redundancy.
If you are self-employed, then you may need to provide accounts for the last
two years, together with details of your accountant (who then may, or may not
actually be approached to verify that the accounts you are producing have indeed
been seen by them.)
If you already own investment property, mortgage statements for each
investment property for the last two years.
If you currently have tenanted property, tenancy agreements for each
property, showing that your tenants have valid contracts.
Your passport. Anti-money-laundering legislation is one of those things that
imposes a burden on all of us. In the UK, it is not uncommon to be asked to
provide a passport by not only your lawyer, but your mortgage broker and even
your estate agent (if you are using one) these days.
Now for some good news. If you do not have all of these documents, then it is
still possible to get an investment loan. However, you MUST tell your mortgage
broker if you have problems producing any of these, or if producing any of these
is likely to highlight credit problems in the past. Your broker, assuming he or
she is any good, will normally be able to find a lender and loan to fit your
circumstances, but there is little they can do if you apply for a loan for which
you do not qualify, and are then turned down.
One final recommendation - if ever you hand over ORIGINAL documents to a
lender or mortgage broker, then ask them to sign a receipt that itemises exactly
what they have taken, AND take photocopies of all the documents before you let
go of the originals.
The reason for stressing this is that I once had a call from a lender who had
asked to see two years statements from each property I owned, plus two years
from my personal bank accounts, and had refused to accept photocopies. The call
was to apologise that the lender had lost them! I explained that having
originals was vital to my business, as the lender would agree, that each
duplicate issued by my bank or other lenders would cost typically 20 pounds, and
that I would therefore be issuing a small claims court claim against them for 20
pounds times 96 statements - that is to say for just under two thousand pounds.
I reminded them that their representative had signed a receipt for all the
documents. Mysteriously, within 90 minutes, I had a phone call back saying that
the documents had been located.
Mark Harrison is a property investor, author and speaker. He runs training courses and seminars about property investment and web marketing in the UK.
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