How to Prepare to Speak to a Bank to Get Finance

In your pursuit to obtain a mortgage loan for your property investment, there are several aspects that you have to take into account before approaching a bank or lending institution.

Assess your needs. Determine first your overall financial situation. Ask yourself if you have enough savings to push through with your investment plan, if you have a good credit score and payment history.

Consider your finances. Decide whether you will use part of your personal funds for your investment venture or will you rely totally on a mortgage loan? Figure out the amount of loan you want as well as your financial capability. As well as thinking about the loan amount you can borrow, you need to consider your ability to repay the loan.

Fixed versus variable loan. Consider the type of loan you want - is it going to be a fixed rate or variable rate loan? A fixed rate loan involves a locked in rate for the duration of your loan but it can protect you against interest rate fluctuations due to market conditions. Variable rate loans are preferred by some as it allows them to avail of low interest rates when the market is performing well.

Credit rating. Having a good credit history is vital. Your ability to maintain a favorable credit standing will show in your credit rating.

Do some research. Shopping for loans from different banks and lenders will help you compare and guide you in making your final decision. This is where a good finance broker can save you time and money.  Let them do the leg work for you.

By Wendy Moore, Founder, www.savvywebwomen.com