Maximising your chances of getting your mortgage approved

Show notes

Phoebe Blamey is the Director and Founder of Clover Financial Solutions, a boutique brokerage based in Melbourne. She’s also the author of “The Happy Money Journey”, a book about making good financial decisions and living life on your own terms.

In this episode, Phoebe breaks down everything you need to improve your chances of getting your mortgage application approved. She’ll explain exactly what mortgage brokers are looking for in your application and the biggest mistakes first-home buyers typically make. Plus, Phoebe shares her top tips to help maximise your chances of success.

Transcript

Michael 0:00
The information contained in this podcast is general in nature and is not to be taken as financial or personal advice.

Michael 0:06
It does not consider your objectives, financial situation or needs.

Michael 0:10
You should consider whether this information is suitable for you and your personal circumstances before acting on it.

Michael 0:17
Hi and welcome to The Home Run your guide to buying your first home in Australia.

Michael 0:21
On the show, I’ll walk you through the home buying process from every angle we cover the steps to take the pitfalls to avoid and the answers to all your questions you’ve been dying to ask.

Michael 0:31
No matter what stage you’re at, you’ll learn everything you need to know about buying your first home.

Michael 0:35
I’m your host, Michael Nasser, and I’m a mortgage broker at Lendstreet, and I really love helping people buy their first home.

Michael 0:45
Phoebe Blamey is the director and founder of Clover Financial Solutions, a mortgage brokerage based in Melbourne.

Michael 0:51
She’s also the author of The Happy Money Journey, a book about how to make good money decisions and live life on your terms.

Michael 0:58
In this episode, Phoebe will break down everything you need to know to improve your check chances of getting your mortgage application approved.

Michael 1:05
She’ll give you the inside word on what mortgage brokers are looking for in your application and some of the classic mistakes first home buyers make on their applications.

Michael 1:14
Plus, Phoebe will share a few tips so you can maximise your chances for success.

Michael 1:19
Let’s jump in, Phoebe.

Michael 1:24
Welcome to the show.

Phoebe 1:25
Thank you so much for having me.

Phoebe 1:27
I am actually so excited because I’ve been listening to your show for a while now, and I think I’ve recommended a couple of our clients hop on to it just because you’ve got some really good advice for first home buyers.

Phoebe 1:37
And it’s always great to listen to something that’s pretty simple.

Phoebe 1:41
I think the one that I’ve liked best, aside from the one we were talking about before with Frank Valentic, was the ones where you question and answer.

Phoebe 1:48
I think they’re really good.

Phoebe 1:49
I think that’s such a good idea.

Phoebe 1:51
It’s so helpful.

Michael 1:52
The mail bag episodes, yeah.

Michael 1:55
Yes, exactly the good old mail bag.

Michael 1:57
So answering the questions that people ask, I think you know, I enjoy doing those as well because obviously they’re pretty relevant to what people’s sort of concerns are at the moment.

Michael 2:05
So, Phoebe, for those that don’t know you’re the director at Clover Financial Solutions, can you tell me a little bit more about what you do there?

Phoebe 2:12
Absolutely.

Phoebe 2:12
So I used to be a regional manager at Aussie Home Loans years and years and years ago, 2003, and I went from there to starting my own broken business with a business partner that unfortunately, didn’t work out very well.

Phoebe 2:25
But then I started my own broken business, just me and absolutely loved it, helping people into their homes, their first home, their next home building relationships with clients, and all that sort of stuff.

Phoebe 2:36
I absolutely love doing and really was very passionate about all the things to go with that.

Phoebe 2:42
And then within that, I started seeing a need for people to get a little bit more financial education.

Phoebe 2:48
I wrote a book about, Oh, it was the beginning of 2020 called The Happy Money Journey.

Phoebe 2:53
And it’s all about how people get their life together financially, no matter what age, no matter what life stage.

Phoebe 3:00
Just a little journey of going from broke, which I was to getting all the way through to having money and feeling financially comfortable.

Michael 3:08
So global financial solutions, I guess, then, was primarily a mortgage broking business.

Michael 3:12
And what led you to mortgages like, How did you end up and you mentioned Aussie Home Loans?

Michael 3:16
Was it something that you always aspired to be when you were younger?

Michael 3:19
Or how did you fall into being a mortgage broker?

Michael 3:21
And then I want to talk about how you got into more the educational stuff, which you’re also pioneering at the moment.

Phoebe 3:26
OK, so to get into mortgages, I came back from living overseas and I had a two year old child and I was a single parent and down the road from me, Bank of Melbourne, down the road from my dad’s place, Cos I moved back in with my dad and I was 27 and moved back in with my dad and down the road from his place was a Bank of Melbourne Childcare Centre, and dad said to me you should go and work in banking because they provide childcare

Michael 3:50
Smart move.

Phoebe 3:51
So I went for a job at Westpac in the financial planning area, Westpac and Bank of Melbourne I think were in the throes of a merger back then and went for a job at Westpac and didn’t get it.

Phoebe 4:01
But I did get a job at Nab being an on the phone loan writer and because I was studying at the same time.

Phoebe 4:08
Nab put me on their fast career track, high performance leadership programme.

Phoebe 4:12
And within that you got a mentor and my mentor was from the Bank of Michigan and she was telling me all about mortgage broking cos nab back in those days owned Bank of Michigan.

Phoebe 4:20
This is a long, long time ago.

Michael 4:22
Bank of Michigan being an American bank.

Phoebe 4:24
Yeah, they own two banks and home site long and detailed story.

Phoebe 4:28
But during her mentorship she was in Australia and they sold Bank of Michigan, so she had to go back.

Phoebe 4:33
But she told me all about mortgage broking.

Phoebe 4:35
So from Nab and I was doing really well like career wise at Nab.

Phoebe 4:39
But from there I went to work for Wizard as a sales coach, so going out to all the satellite offices and teaching them how to put loans together and all this sort of stuff.

Phoebe 4:47
And it was a hell of a learning curve for me.

Phoebe 4:49
And I was really lucky, because I I made friends with a few of the BDM’S and and started to understand things like low doc lending, which you didn’t have at nab construction loans.

Phoebe 4:59
I’d never touched a construction loan in my life.

Phoebe 5:01
And because these are all like outer suburban offices, I’m doing all this construction and low doc and self-employed and stuff.

Phoebe 5:08
I’d just never come across.

Phoebe 5:09
So I was sort of learning on the job a lot, and I went from there to being the first female regional manager at Aussie Home Loans.

Phoebe 5:16
But I worked there for three years and really enjoyed it.

Phoebe 5:20
Learned heaps.

Phoebe 5:21
It’s a really interesting business model, and you’d know a lot of brokers, including yourself, that have come from Aussie and Aussie’s got a really good way of teaching people to be brokers.

Phoebe 5:31
So I went from there to starting my own business.

Phoebe 5:35
I had about 10 brokers working with me and was in a business partnership that all went south, and I’d seen myself as being a leader and a businesswoman.

Phoebe 5:44
But what I really loved was being a mortgage broker and and just helping individuals get into their houses.

Phoebe 5:49
And because I had all these friends with BDMS and ex loan writers and stuff like that, I was getting lots of business, so I just started up on my own.

Phoebe 5:56
I named my business Clover after the dog.

Phoebe 5:59
I was looking at all the, you know, Pinnacle and the loan home and all this and just nothing.

Phoebe 6:05
Everything was taken, so I named it after the dog and, yeah, started off.

Phoebe 6:11
And then I’ve had this business for 14 years.

Phoebe 6:14
My daughter’s just left to go to a full time position at loan market, and here I am.

Michael 6:20
And we’ll obviously be leveraging that in that knowledge you have, as as a mortgage broker when we talk about some of the concepts that we’ll discuss later.

Michael 6:25
But you did mention that you’re also guiding or teaching people about financial, wellness and well being.

Michael 6:30
Can you spend a bit of time letting us know about what that looks like?

Michael 6:33
And what led you to that point?

Phoebe 6:34
So a couple of things led me to that point.

Phoebe 6:36
One of them was in 2009.

Phoebe 6:39
I’d just broken up with my boyfriend and my business was going under as well.

Phoebe 6:43
Like that business partnership was just shattered.

Phoebe 6:45
It was it was really bad and it was quite litigious and I was spending a lot of time with lawyers and trying to get myself out of it.

Phoebe 6:53
And I felt like I’d let a whole lot of people down and stuff like that by leaving.

Phoebe 6:57
But I just It just wasn’t working anymore at the same time.

Phoebe 7:01
My boyfriend Scadaddled and he’d been around for a while, so we had, like, joint things and stuff and I realised that I had been paying off his car loan and I didn’t have a car and we were renting and I was paying a lot in rent because obviously we’d had two incomes and now I just had one, and because I was in the middle of this legal battle, I had no money and it was really scary, like I was really broke and I had a young child and she was a private school and so I had to, you know, go in and make financial arrangements with everyone and try and get myself back on my feet as quickly as possible.

Phoebe 7:35
And you know you’re in direct sales, so you’ve got to be really positive all the time and it really took me.

Phoebe 7:41
I think about five or six years to rebuild and get up to being normal again and being able to take holidays and just living a normal life because you get really scared as well.

Phoebe 7:51
And so much of being broke and so much of being under financial strain is emotional and not actual.

Phoebe 7:57
So I was making OK money, but I was too scared to spend it.

Phoebe 8:00
I was too scared to invest it.

Phoebe 8:02
I didn’t want to make any big moves like buy another house or something because I just I needed to stay within my comfort zone and I realised that that whole mindset was really holding me back.

Phoebe 8:13
So I started to put myself on a little bit of a journey and I was watching what my clients, my particularly my wealthy clients and watching more their attitude to money and their attitude toward risk and and their attitude towards abundance and then from there, working what they actually do with their money.

Phoebe 8:31
So how they spend it, what they spend it on because I can tell you now.

Phoebe 8:35
You look at a very wealthy person and you don’t see multiple uber eats, and you don’t see multiple drive-through of McDonald’s.

Phoebe 8:42
You do see a gym membership and you see like stuff like that, and you see a few holidays.

Phoebe 8:47
But you don’t see them living and just throwing away all their money.

Phoebe 8:50
They’re careful.

Phoebe 8:51
They don’t stop living the life that they want to live, because they, you know, go on holidays and live in nice houses and drive nice cars and Teslas and the whole situation.

Phoebe 9:01
So I wanted to be like that.

Phoebe 9:03
So I worked out what certain things they were doing financially, how they looked after their money.

Phoebe 9:09
They don’t have budgets, but they do know where their money goes and they automate a lot and everything’s fairly simple, and they keep their finances fairly simple.

Phoebe 9:18
They might have complex business structures, but the way that they run their day-to-day, they’re running out of two, maybe three accounts.

Phoebe 9:24
They don’t have multiple accounts, they don’t have multiple savingss.

Phoebe 9:28
They’ve got investments, and everything’s just really simple and so I.

Phoebe 9:32
I find it down and kept it simple and and then wrote a book about it so that other people could learn the things that had taken me years to learn.

Phoebe 9:39
They could just condense it into a really short time and pick it up.

Phoebe 9:42
And now I’m starting to do some courses and stuff.

Phoebe 9:45
So if you know anyone that needs help with just their basic financials and just getting their stuff together, and I know that’s what we’re going to talk about today as far as going to the loan applications.

Phoebe 9:57
But that’s what that business is all about.

Michael 9:59
It stems from experience.

Michael 10:00
It was an experience that obviously caused some fear from within yourself.

Michael 10:03
And you want to mitigate that fear that you had so you could live a little and you were lucky enough to be a broker.

Michael 10:08
And so you could see and have clients who were wealthy and sort of study how they lived and operated and how they were successful.

Michael 10:14
And I guess you know, you can replicate that, , in that particular way and success is the formula and you’ve seen it.

Michael 10:19
And now you’re, I guess, wanting to inspire people and teach people the stuff that you’ve learnt.

Michael 10:23
So they’re not in that situation again.

Michael 10:25
Cool.

Phoebe 10:25
Yeah.

Michael 10:25
No, no, I.

Michael 10:25
I think that sounds like what?

Michael 10:27
What’s the name of the book?

Phoebe 10:28
The happy money journey.

Michael 10:29
Cool.

Michael 10:29
And we’ll provide links to that in the show Notes as well.

Michael 10:31
All right, So the topic that we’re gonna be exploring today is back on your mortgage broking skill set and the things that you’ve learned over the course of your years as a mortgage broker.

Michael 10:39
It’s how to improve your chances of being approved for a mortgage.

Michael 10:43
So, I, I guess we’re really bringing it back down here to a basic level for our first home buyers that are listening.

Michael 10:48
And, , on that journey to get the home loan.

Michael 10:50
And there are some things that can be done obviously with some smart management and being organised that will enable you to be better off being approved for a loan.

Michael 10:58
So well, let’s start off with the basics.

Michael 11:00
What do mortgage brokers consider or look for when you’re applying for a mortgage?

Michael 11:05
And I guess, more broadly, what are lenders looking for specifically as a general rule?

Phoebe 11:09
So the first question I always ask is, what do you want to do?

Phoebe 11:12
And then the second question I ask is, How much money have you got to put to that and how much are you earning?

11:18
People would say, I’ve got quite a lot of savings.

Phoebe 11:20
I’ve got 5000 dollars and other people say I’ve got quite a lot of savings.

Phoebe 11:23
I’ve got 100 and $5000.

Phoebe 11:25
You don’t necessarily need the 105 to be able to buy a house.

Phoebe 11:28
But the more you’ve got, the easier it is for us to find you a loan.

Phoebe 11:32
What are you earning?

Phoebe 11:33
Because the bank’s gonna look for your ability to pay the loan back for a start.

Phoebe Phoebe 11:38
So if I’m speaking to someone that’s newly self employed, or if I’m speaking to someone that is on various pensions or government assistance and stuff like that, then it’s a reasonably short conversation because we’ve got to get those people into a position where they can buy before we can start looking at lending for them.

Phoebe 11:57
So you need to earn more.

Phoebe 11:58
You need to get a different job.

Phoebe 12:00
You need to be self-employed for mainly two years with most lenders, but there are exceptions to that.

Phoebe 12:05
So then it becomes about asking questions If they’ve got from being PAYG to contractor, they might still be able to be considered as the PAYG role because they’re doing exactly the same thing for exactly the same person.

Phoebe 12:17
But and different lenders look at things in different ways, but they’re the top two.

Phoebe 12:21
How much money have you got and how much money do you earn?

Michael 12:25
And the good thing I think I like about the how much money have you got?

Michael 12:27
It also will speak to their savings or their ability to to have been able to.

Michael 12:31
So if they’ve got a larger saving deposit or they’ve got more to contribute, it would indicate perhaps some measure of generalisation a better ethic towards money.

Michael 12:39
And you know, the ability to save is is quite a, I wanna say advanced skill set, but it’s quite a It’s a hard thing to do that savings.

Phoebe 12:45
I think it’s an advanced skill set.

Phoebe 12:47
It’s easier to pay back a debt than it is to save money.

Michael 12:50
That would make sense.

Michael 12:51
So yeah, so then it is an advanced skill set that not a lot of people have the time to do or the patience to do or the knowledge to do.

Michael 12:56
I’m not.

Michael 12:56
I’m not too sure, but OK, so along with that, what would be some of the biggest mistakes you see people make when they’re coming to you, to apply for a mortgage for the first time?

Michael 13:04
Or at any time.

Phoebe 13:05
They’ve just taken out a car loan that is in my top three lots and lots of afterpay.

Phoebe 13:11
So seven or eight afterpay is going out every week.

Phoebe 13:15
They only eat uber eats because we’re looking in their bank statements so we can see everything about them.

Phoebe 13:21
So we’re seeing people that are being quite wasteful with the way that they approach their money.

Phoebe 13:26
Doesn’t speak well to the third thing that lenders look for, which is their character, and their character can also be how long they’ve been in a job for or how long they’ve stayed in jobs for.

Phoebe 13:36
It can be how they do their savings, which we were just talking about.

Phoebe 13:39
But it’s also how they spend the money that they’ve got day to day, and lenders are more and more concerned with how you’re spending the money that you’ve got day to day.

Phoebe 13:48
If you’re living at home with your parents.

Phoebe 13:50
They’re gonna be asking why you don’t have any savings at all.

Phoebe 13:54
Where’s your money?

Phoebe 13:55
Like what’s happened if you’re going out and getting all sorts of credit just before you’re about to apply for a home loan, it can show a lack of management in that sort of stuff.

Phoebe 14:03
So what we’re looking for is really positive things.

Phoebe 14:06
Like extra money is going on to debts.

Phoebe 14:08
Hecs is being paid off early, if we possibly can, because everyone knows once we hit $100,000 in income, Hecs is taking 7% out.

Phoebe 14:15
It’s a huge bite of your gross income.

Michael 14:21
And that’s something that first home buyers definitely get affected with when they don’t realise. Because Hecs is probably one of the biggest limiting factors.

Michael 14:24
A lot you know, that can play a part in your borrowing capacity.

Phoebe 14:27
Absolutely.

Phoebe 14:27
Having unnecessary debt is big, but having hecs debt, you sort of you don’t think about it because it comes out of your tax returns.

Phoebe 14:34
And quite often I have conversations with people they don’t even mention when we’re talking about what do you owe?

Phoebe 14:40
They don’t even mention hecs because they don’t even think of it as something that they owe.

Phoebe 14:43
But yeah, hit that 100 120,000.

Phoebe 14:46
And that’s what I think.

Phoebe 14:47
Most first time buyers tend to earn a lot of money.

Phoebe 14:50
I mean, you’re in Sydney, they probably earn more.

Michael 14:53
But it it depends. But yeah, no gen generally young professionals are.

Michael 14:55
It’s not uncommon to be saying it comes at 100 120 especially then if there’s two parties to the loan and they’re both on 80 grand each so that also can play a part as well.

Michael 15:04
Let’s look at improving some of the the chances here of these basic concepts or these categories that we’ve mentioned.

Michael 15:09
You mentioned the ability to get a loan, obviously, in the savings or how much money you have.

Michael 15:13
If we start with the first one the capacity to pay back a mortgage, what can first home buyers do to improve their capacity to pay back a mortgage?

Michael 15:20
And I guess we’re sort of touching on that already, and, it’s probably more geared towards what can we do to ensure that we are maximising the borrowing capacity?

Michael 15:29
Is it just about reducing debt Is there anything else that can be done in that regard?

Phoebe 15:33
Look, I think it’s mainly about reducing debt, making sure that you’re in the best possible situation.

Phoebe 15:39
Minimising debts, lowering credit card limits, paying off hecs and not taking out extra loans.

Phoebe 15:45
I think there’s a misconception, because it’s actually true in America, but it’s not true.

Phoebe 15:50
Here is that you have to get credit to be able to get more credit, but you don’t have to do that here.

Phoebe 15:55
You can get your credit score can come from your telephone bills and your electricity bills and just paying things on time.

Michael 16:01
Can you explain that concept a little bit further?

Michael 16:03
So what does that actually mean?

Phoebe 16:04
So a lot of people that I come across think that they need to have some sort of credit.

Phoebe 16:08
They need to have a loan or a car loan and have proven that they can pay that loan back in order to then get a loan large a loan like a home loan so people will take on a credit card to give themselves a better credit score.

Phoebe 16:20
And that’s true in America.

Phoebe 16:21
You get a better credit score from.

Phoebe 16:22
That’s how you get your credit score is by applying for credit.

Phoebe 16:25
But in Australia you’re applying for credit when you get an electricity account and you’re also applying for credit when you get a telephone account.

Phoebe 16:31
So keeping those in good standing is really helpful for your home loan.

Phoebe 16:36
You don’t have to have organised yourself a credit card or something like that.

Phoebe 16:40
If you’re getting overtime and allowances and all that sort of stuff, just make sure that you’ve got overtime in recent payslips.

Michael 16:48
But that speaks to the income.

Michael 16:49
So try and maximise your income as much as possible.

Michael 16:52
I’d imagine there and and have that recorded bonuses.

Phoebe 16:55
And stuff like that can normally be used if they show on the pay slip.

Phoebe 16:58
If something hasn’t happened yet, we often even though it’s been coming to you every year, we can’t show it, particularly actually with the use of overtime.

Phoebe 17:06
I’m seeing this more and more from lenders is that if the overtime is not on the pay slip that we’re presenting or one of the payslips that we’re presenting, they sometimes won’t use it at all.

Phoebe 17:15
Whereas you’ve been getting it, make sure you get it in in the pay cycle that we’re throwing the loan in for.

Michael 17:20
Let’s jump to the second point, which is the deposit.

Michael 17:23
And and and again, this probably speaks more to that skill set we were we were discussing earlier and more to your probably where a lot of your educational stuff is now coming across because it’s all about how you’re spending your money and how to be financially savvy.

Michael 17:35
How can first home buyers increase their deposit or their savings to help with the mortgage application?

Michael 17:40
What are the main tips that you see there?

Phoebe 17:41
So one of the main tips is pay your rent on time.

Phoebe 17:44
Rent can be counted as genuine savings for something like the first time lenders deposit scheme, but a lot of lenders if you’re getting a gift, but you’re it’s not quite enough that you don’t need mortgage insurance.

Phoebe 17:54
You need to have genuine savings.

Michael 17:56
And can you explain what genuine savings is?

Phoebe 17:59
Yeah, genuine savings is either your ability to pay extra on a debt.

Phoebe 18:03
So not just pay a debt back, but pay extra and pay it off.

Phoebe 18:06
It’s your tax return money.

Phoebe 18:08
It’s your rent, and this varies between lender to lender, but it’s making sure that you’re doing these things on time and as you should rather than you know if you miss rental payments or if you don’t pay extra on loans or if you don’t get a tax return, it’s hard to prove genuine savings particularly important with all the schemes, but also speaks to your character.

Phoebe 18:27
It also says, You know this person’s able to honour a commitment so you could be getting a $50,000 gift from your parents.

Phoebe 18:36
That’s enough to buy your $500,000 house, but you’re still gonna need mortgage insurance on it.

Phoebe 18:40
For whatever reason, that you don’t qualify for the one of the many government schemes that are around at the moment.

Phoebe 18:46
But assume that you need mortgage insurance.

Phoebe 18:48
You need to have genuine savings.

Phoebe 18:50
So that’s what we’re looking for.

Phoebe 18:52
That’s collateral, and then it’s also the type of house you’re buying.

Phoebe 18:55
So if you’re buying something, that’s company title.

Phoebe 18:58
If you’re buying something that’s service departments, stuff like that, they’re not so acceptable to lenders.

Phoebe 19:04
They won’t lend high levels on that.

Michael 19:06
And so I guess some more tips there for the deposit like are there any other main tips that you see how a first time buyer can accelerate their savings.

Michael 19:13
Or I know we mentioned no uber eats.

Michael 19:15
So let’s scrap uber eats that’s gonna help us save.

Michael 19:17
Are there any sort of other main points or tips that you know you’d have for first time buyers?

Michael 19:21
That how you can accelerate that deposit?

Phoebe 19:23
I personally like high interest savings accounts and micro investments, high interest savings accounts you’ve really got to look for.

Phoebe 19:31
So things like ING will have a special on for three months, and then Saint George will have the same special.

Phoebe 19:37
And so you flip between different savings accounts, keep a record of everything so you can flip us and make as much money as you can because you’re getting bonus interest and stuff like that.

Phoebe 19:47
It’s really gonna help you save.

Phoebe 19:48
But in order to prove it to the lender, we need six months or three months worth of savings statements in a row, so make sure you keep your savings we’re finding with.

Phoebe 19:57
I think it’s you bank.

Phoebe 19:58
One of them has a you might know this better than me has a a savings account for first buyers and it’s a really high interest rate, but they don’t give statements.

Michael 20:08
OK, well, that’s not effective.

Michael 20:09
And I I’m not aware of that one.

Michael 20:11
No, but even if it’s there and you can’t get the statements and how do you prove it?

Phoebe 20:13
Yeah, how do you prove it?

Phoebe 20:14
So we need to prove the genuine savings we need to show them that you’re you’re putting a regular amount in or you’re getting a A lump sum, but you’re leaving it there for three months.

Phoebe 20:24
You can’t get a lump sum on Saturday and then call me on Monday and say, I’ve got 50,000 in genuine savings.

Phoebe 20:30
It doesn’t work that way.

Phoebe 20:31
It has to be there for a period of time, or we find it another way.

Michael 20:36
Any other tips there for accelerating the deposit? I think I like that idea of the high interest rate savings accounts, and you’ve got to be diligent, definitely, and I.

Michael 20:41
I think if people want to know more about that, obviously they can reach out to you and find out more about your tips and and what specifics you might have for them.

Michael 20:47
The third thing that we speak about quite often, so we’ve obviously got our borrowing capacity, and we’ve got our savings that we’ve got to be on top of.

Michael 20:53
It’s about consistency and lifestyle.

Michael 20:55
That’s something that I’ve heard you mention quite a few times.

Michael 20:57
How can first home buyers increase their consistency on paper to better their chances of being approved for a loan To develop that consistency.

Phoebe 21:05
Stay at the same job. Don’t move house often and stay at the same job.

Phoebe 21:09
Or at least if you’re changing jobs, do the same thing when you change jobs.

Phoebe 21:13
So don’t move from being a lawyer to being a chef.

Phoebe 21:16
It’s not consistent, and the lender needs to have faith that you’re gonna be able to maintain that role and how they determine that is they look back at your old role.

Phoebe 21:24
If you wanted to employ someone, you don’t want to employ someone that’s had eight different jobs in four years, you want to employ the person that’s had one job showing that they can stick to it and then comes to your job.

Michael 21:35
Yeah, makes sense, and I think consistency there in work and definitely helps, especially for the purposes of an application we’re talking about like.

Michael 21:43
Obviously, once the loan is approved and you’ve settled and you’re in the house, then free to do what you want.

Michael 21:47
But this is specific to what we can do to better improve our chances of a successful home loan application.

Michael 21:52
And and I think, yeah, that job consistency is critical.

Michael 21:55
And then consistency in in all the other facets savings and and everything I think is definitely a good tip there.

Phoebe 22:01
They’re looking for you to be a high character person.

Phoebe 22:03
So you know, there are some jobs that it’s hard to be consistent in.

Phoebe 22:06
It’s hard to be consistent in particularly hospitality jobs.

Phoebe 22:09
And lenders are more reluctant to lend to people that are in casual hospitality jobs than they are to people that are doctors that are permanently employed at a hospital.

Phoebe 22:17
So when you’re considering buying a home also within that, consider your career.

Phoebe 22:22
But consider why they want that because the reason they want that is because they can see better than we can because they’ve got all the research, how likely you are to stay in that role for a specific period of time to be able to service that debt.

Michael 22:36
Yeah, I think for me.

Michael 22:37
All of this speaks to the fact that you need to be organised when you go to make an application.

Michael 22:42
And I don’t think very rarely are you gonna approach a broker and get your loan approved.

Michael 22:47
After your first meeting, it would be more like you’d meet with a broker and then these things would be discussed and they’d be mapped out and strategized, and it might not be.

Michael 22:55
And something I see quite often is when I first start speaking to a first home buyer, it’s not gonna be in that first week that we’re doing alone.

Michael 23:00
It’s probably gonna be a 346 months, sometimes 12 months time frame, where we’re working on a strategy to get us ready for the application, too.

Michael 23:09
So and that’s quite common.

Michael 23:10
I’m I’m sure you see the same thing when you’re dealing the first home buyers and I get this.

Michael 23:13
This episode is more about how can someone listen to it and accelerate that process?

Michael 23:18
So when they get to a broker, they’re already doing these things.

Michael 23:21
They’ve already had the savings in in the right account.

Michael 23:23
For the three months they’ve eliminated uber eats.

Michael 23:25
They’ve stayed in the same job.

Michael 23:26
I mean, there’s some of the, you know, the gold nuggets that you’ve provided, you know, like.

Michael 23:28
And if you’re doing that, when you go to see the broker, well, you’re gonna be in a better position to get your loan approved, which is in everything that we’re talking about today.

Phoebe 23:37
And that’s what we want. We want people to own their own house because owning your own house, it’s amazing.

Phoebe 23:41
It it makes you feel safe.

Phoebe 23:42
You’ve got something that’s yours.

Phoebe 23:44
You’ve got something that is a really huge future investment, particularly if you’re buying in Sydney because it’s so expensive.

Phoebe 23:50
But, you’re really investing in yourself when you buy a house.

Phoebe 23:54
And in order to invest in yourself, you really need to be solid and consistent and and show that you’ve got the not just the capacity to pay it back, but you’ve got the character that’s going to pay it back as well.

Phoebe 24:05
Speaking of also paying your bills on time, making sure that your account doesn’t go overdrawn, Small things like that can make a real difference in particularly getting your home loan approved at high loan-to-value ratios and I know that your listeners probably know what I mean by that.

Phoebe 24:23
But that’s the loan amount compared to the house value.

Phoebe 24:27
So the high, the more you borrow, the greater percentage of the house value you borrow, the greater the risk the bank feels that they have and therefore would like to see that you’re you’re not missing payments and you’re not sitting there with a an unpaid telephone bill or something like that.

Phoebe 24:41
But those things are also really easy to clean up.

Phoebe 24:45
Some of those things happen in error because you’ve moved house or something like that.

Phoebe 24:48
Clean those things up.

Phoebe 24:49
We can help you as mortgage brokers.

Phoebe 24:51
We come across this all the time, nothing to be embarrassed about and will not stop you getting a house.

Michael 24:56
Yeah, The point is, you’re being proactive about it if you identify that there is an issue sorted out as quickly as you can, because it’s going to hinder the application at some point.

Michael 25:03
So you’re better off getting on top of it, not to be worried about it or ashamed of it, or concerned about what other people may think it’s about, sort of throw it out the window.

Michael 25:09
Let’s just sort it out and and focus on what we need to do to get sort of get this loan over the line.

Michael 25:13
So that’s a great point.

Michael 25:14
We always close out our interviews with two questions, and then I guess we try to keep them consistent so we can compare answers.

Michael 25:20
The first one is, What would your number one tip for a first home buyer be?

Michael 25:23
That’s trying to get into the market today.

Phoebe 25:24
Lower your expectations.

Phoebe 25:26
I’m in Melbourne.

Phoebe 25:27
I’ve got some beautiful first home buyers that I’m dealing with at the moment that six months ago could buy for about 8 900,000.

Phoebe 25:34
That now can buy for about 607 100,000 like it’s really dropped because of the increase in interest rates.

Phoebe 25:40
But don’t let that stop you buying buy because that property can be your future.

Phoebe 25:45
Be your first apartment that becomes part of a big property investment portfolio.

Phoebe 25:48
Buy it.

Michael 25:49
So I guess expectation management there and what you think and what you end up in May may not be the same thing or may not be perfect, but just get your foot in the door basically. Second one is and we can keep this relative to Melbourne and the areas that you know if you’re a first home buyer and we, you know, magically gave you a million dollars, so you didn’t have to worry about a loan or anything like that.

Michael 26:07
You’ve got the million dollars and you’re able to buy. Where would you buy and why?

Phoebe 26:12
OK, in Melbourne, I’d actually buy in Fairfield, because all the surrounding suburbs are Q and the suburbs that have really grown in value.

Phoebe 26:22
But Fairfield hasn’t really been hit by that aton, which is also on the other side.

Phoebe 26:27
So there’s a part of north East Melbourne where there used to be a really small bridge to get across from east to north and that bridge, that road has been really widened, and there’s a whole lot of flats that have gone up there and stuff like that, and it’s just opened up the between East and North.

Phoebe 26:43
So Alvington, which is directly on the other side of where this road was, has just gone gangbusters.

Phoebe 26:48
It’s it’s basically doubled in value in the last couple of years, and Fairfield’s right next door, that’s where I would buy.

Michael 26:55
That’s an awesome nugget.

Michael 26:56
So people in Melbourne are listening like I’d be hitting up real estate and and domain and and type in Fairfield and seeing what we can pick up.

Michael 27:03
If that’s something that, because again and what you’re speaking to, there is capital growth, I guess.

Michael 27:07
Which is, you know, something you’ve identified.

Michael 27:09
Obviously, when we are buying property, we want to get that increase in capital growth.

Michael 27:12
And there’s a lot to unpack in what you’ve said there.

Michael 27:14
But I guess the summary is you’re looking at suburbs that have some potential value.

Michael 27:18
And in this instance, because of the widening of the road, it’s obviously shot off into one suburb, and now it’s going to affect the surrounding suburbs eventually.

Michael 27:25
So that’s quite a bit of insight there.

Michael 27:27
So yeah, no I I.

Michael 27:28
I love that one.

Michael 27:28
That’s a great example.

Michael 27:29
Well, thank you for joining us today on the show.

Michael 27:31
Phoebe, I really appreciate your time.

Michael 27:33
We’ve mentioned you’ve got a book, but where can our listeners find you? If they want to learn more about what you have to offer?

Phoebe 27:35
They can find me at Phoebeblamey.com.au.

Phoebe 27:40
We’ve also got a Clover Financial Solutions website, but
Phoebeblamey.com.au for all the courses and books and all that sort of stuff and on Instagram and Facebook as the happy money journey.

Michael 27:53
Wonderful.

Michael 27:54
I love it.

Michael 27:54
Well, those links will be in the show notes, So if want to check them out, feel free to check out Phoebe on those particular links.

Michael 27:59
But thank you so much again for your time today and joining me on the show.

Michael 28:02
I really appreciate your time, Phoebe.

Phoebe 28:03
Absolute pleasure.

Phoebe 28:04
I really enjoyed myself.

Phoebe 28:05
Thank you so much.

Michael 28:09
You’ve been listening to the home run your guide for buying your first home in Australia.

Michael 28:13
This podcast was produced by Lendstreet.

Michael 28:15
Lendstreet is a mortgage broker and home loan specialist that helps first home buyers find the right loan to meet their needs.

Michael 28:21
We know applying for a loan can be overwhelming and complex, so we help guide and support first home buyers through the process from start to finish.

Michael 28:28
To find out more, head to our website lendstreet.com.au

Michael 28:32
We’ve also put a link in the show notes to make sure you don’t miss an episode of the home run.

Michael 28:37
Be sure to subscribe to or follow the show in your podcast app, and while you’re there, please leave us a five star review.

Michael 28:44
It really helps others find the show.

Michael 28:47
I’m Michael Nasser and we’ll be back next episode, covering another step on the journey to owning your first home.