Automatic approval of a mortgage?

[alexb5784]

This is a question for anyone who invests in property, owns a home or is a mortgage professional.

A friend told me that if you put down 30% of the property cost, you're automatically approved for a mortgage. Is this true? When I buy (in about 16 months), I do plan on giving a bigger down payment than the normal. I want to lower my mortgage payments and rent out my extra bedroom for income. Putting down 30% is ideal for me.

And...can you apply for two mortgages at the same time? Let's say I want to buy a condo for me to live in, and then another as investment property. Or should I get one condo first, and then use then use it as equity to borrow for the second one? There is so much to learn about real estate! But I'm ready

Thanks

[AndrewJ]

Here in Australia this is called a 'low documentation' loan and is great for self employed people who cannot provide income or employment documentation. On the other hand you'll usually need to pay slightly higher interest rates for the loan.

Andrew

[alexb5784]

Yes, I'm self employed, so getting approved for the mortgage will require more paperwork. But I'm not going to say it will be harder for me, because I'll just create the mindset of "Oh it's going to be so hard to get a mortgage, because I don't have an employee's income advantages." I'm not going to think like that, because if I do, then it will be hard. I've created an LLC, and I've made myself my own employee. I also pay myself through payroll, so that I can have paycheck stubs. I believe that I will have to provide two years of tax returns when applying for the loan(s).

I'm not worried about it though, but I want to be prepared. And this is why I'm doing my homework now, 16 months in advance

Cheers and thanks for your reply