Todd Polke explains how property investors can increase lending capacity when banks tighten serviceability requirements. He recommends growing primary income, building multiple income streams, creating a profit pipeline through regular asset turnover, and positioning yourself for low-documentation lending products.
Okay, Belinda has come up with a great question. How do you increase your lending capacity with the banks so you can borrow for an investment property and not just the obvious ways? Now, as we know, serviceability is in a crunch time and so you've got to be far more strategic in how you have a strategy around your lending so you can actually continue getting lending year after year after year. There's some obvious ones. Grow your income. Sure, great. That's a good thing to be able to do. You should absolutely focus on doing that. Number 2, grow multiple income streams. Again, another bit of an obvious one, but there's lots of different ways you can do that. Number 3, we wanna generate a profit pipeline, okay? This is where we start to turn over assets within our portfolio on a consistent basis, where we can create bigger profit chunks that we can either use now to pay down debt or to put in bigger deposits into deals. So, grow your main source of income, create multiple income streams, but make sure it's through the right income streams, create a profit pipeline, and then position yourself for low documentation lending.
