Each bank has expertise in different categories of risk. Based on their experience, some banks are comfortable lending for commercial development, others rural, others might be most comfortable lending for urban residential home loans.
Either way, your borrowing ability is largely dictated by your ability to service the principal and loan repayments for the duration of the loan. This is largely dictated by your disposable income, no matter the potential value of the project. i.e.:…what you earn minus your variable fixed expenses (rent + services + food + education) – all of which are variable and depend on how much you are willing to forgo immediate gratification, by moving into lower rent digs, buying less avocados, forgoing Netflix, and taking less night classes.
For example, forgoing Netflix ($20/month) allows you to borrow about 4000 more towards your house (better kitchen, downlights, whatever). So forgoing Netflix, using a smaller mobile plan, using a smaller fiber plan, and cutting out on maple syrup and pancakes every week means you can service another $15,000, which is enough for a second, simple, bathroom or small deck – both of which will add more value to your final house sale price.
Your borrowing ability is largely dictated by your ability to service the principal and loan repayments for the duration of the loan, no matter the potential value of the project. This ability is largely dictated by both your job security combined with your disposable income. I.e.:…what you earn minus your variable fixed expenses (rent + services + food + education) – all of which are variable and depend on how much you are willing to forgo immediate gratification, by moving into lower rent digs, buying less avocados, forgoing Netflix, and taking less night classes.
For example, forgoing Netflix ($20/month) allows you to borrow about 4000 more towards your house (better kitchen, downlights, whatever). So forgoing Netflix, using a smaller mobile plan, using a smaller fiber plan, and cutting out on maple syrup and pancakes every week means you can service another $15,000, which is enough for a second, simple, bathroom or small deck – both of which will add more value to your final house sale price.
Banks see husbands and wives as a single (combined) unit of income. Which is great if you have two incomes.
On the other hand, if you have two partners, it doesn't move the dial at all. Banks will expect that either partner can service the loan on their own, in case one partner pulls out. Having a partner doesn't change how much can be borrowed – it just lowers the pain of paying – at least while the partnership lasts.
Each bank has expertise in different categories of risk. Based on their experience, some banks are comfortable lending for commercial development, others rural, others might be most comfortable lending for urban residential home loans.