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Cassie applied for a home loan to purchase her first home through another broker. Unfortunately, that loan was declined and her previous broker said he could help her no further.
Cassie was then referred to Mark Sneddon, Director of Foundation Mortgages by an existing client in May 2021.
During the initial consult, we identified the following challenges. Cassie was a single mother of two, low self-employed income, no child support assistance coming from her children’s father, low deposit and high living expenses. Whilst a loan was possible. A loan to the level she required wasn’t possible. However, Cassie had an excellent ability to save. Additionally, she was very open to some finance education.
We worked out a full scenario on what she would need to achieve a purchase in the area she wanted. We discussed reigning in some unnecessary expenditure to improve her living expenses, which were much higher than HEM figures. We also worked out a savings goal and an income increase target.
January 2022 saw a follow up consult with Cassie. Unfortunately, due to an increase in HEM figures and an increase of the servicing buffer to 3% above the applied interest rate, Cassie’s borrowing capacity dropped $100K. Cassie was somewhat disillusioned with this. However, I encouraged her not to give up, as lending conditions change all the time and she was doing well with increased savings and improving her expenses.
In July 2022, Cassie’s updated situation saw her income increase significantly, a reduction in living expenses and an additional $30K in savings. However, a suitable property in her target area and price range eluded her.
January 2023 saw Cassie’s borrowing capacity drop, due to several RBA interest rate rises. Property prices had also increased. Thereby shifting the goal post again. However, she remained positive, as her income had increased slightly and her savings were also continuing to grow.
Cassie contacted me again in August 2023 with a property she had found and would like to see how she was situated finance wise. Since the last catch up in January, Cassie’s income had increased by almost 30%. Her savings had also increased significantly due to the higher income. An application was submitted at the beginning of September and formally approved within 7 days. As of November, Cassie now has a permanent home for her and her two children.
In Cassie’s own words in an email after receiving the good news.
‘I just want you to know that I have been told so many times this would not be possible for me. I've wanted to give up so many times and settle with something less. You've helped me create the life I could have only dreamed of for me and my kids and I'll never forget what you've done for me. You’re my hero 😊’
I was very happy to work with, educate and ultimately help Cassie achieve her home ownership goal.
So many times, people think they cannot achieve their goals of getting a loan to own their own property. Sometimes that’s because of other people telling you, you can’t. What if you had someone telling you, ‘You can. But not the way you thought.’ Sometimes, you just need a little education in finance and someone to help you along the way. That’s what the team at Foundation Mortgages do. We think outside the box, provide alternatives and a pass on a little bit of finance education to our clients along the way.