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No Income? No Problem!

Our deal of the month is one we are really excited about - as we love seeing our property investors succeed!

We have recently had a client who isn’t currently working full time, and therefore their income isn’t in a position to meet the harsh servicing criteria that is required by main-bank lending.

Our client has a home worth $1.5m in Auckland, and only $20k of debt with a main bank. They are a classic case of having high equity and low income.

They wanted to look at purchasing a trade property (buy, do-up, sell) and didn’t want to let the fact they weren’t working hold them back. They also didn’t want to get a job just to please the bank.

Our solution was to look at getting them funding through a short-term lender, who would consider lending based on an acceptable property as security, and also a suitable exit strategy. As our client intended having the lending short-term (maximum 6 months), and their home was accepted as a property to lend against, we were in business!

Our client needed $900k to purchase the trade property, $85k of renovation funds, and $20k to refinance out their existing lender. A total of $1.005m. In addition to this the lender capitalized the interest which means that our client didn’t need to make regular repayments on the mortgage until the trade was sold at the end of the loan term. The fees on this loan were 1.5% + GST, which totaled around $16k. Interest for 3 months was around $15k too, at an interest rate of 6%. Total financing costs - circa $31k.

Our client has recently sold this property for $1.34m, which is around $325k, prior to agents costs and tax/GST.

In many cases people can hear higher interest rates and loan fees (which are exceptionally common in the non-bank space) and turn away a good deal. This client looked past that and was able to walk away with around $300k pre-tax income in 3 months as a result.

If your situation is a bit tricky, and you think the non-bank space may suit you, please feel free to get in touch at