Mortgage Experts Blog

< back to blog home

Savings and Loans - how it can affect your home loan chances

Marty McDonald - Friday, July 08, 2011

Another factor that lenders look at when considering you for a loan is your net asset position i.e. the difference between your assets, savings and loans.

If you have more debts (car loans, personal loans and credit cards) than savings and assets it will not be likely that you will be able to secure a home loan. When assessing your "asset position" as it's sometimes referred to lenders will also look at your age, with older potential borrowers expected to have accumulated more net assets than younger borrowers.

Credit scoring is an automated system that most lenders are using for determining a borrowers likely credit worthiness. The algorithms that these models use are complicated and kept secret so as to avoid manipulation. However it is clear that your savings and loans position is one area that will greatly affect your credit score with a lender.  If you fail a lenders credit score test your application can be declined automatically without it being reviewed by a human being at all. 

So for that reason if your ratio of savings and loans is not strong but you want to apply for a home loan make sure you talk with us first. We have lenders who don't use credit scoring at all so we can sometimes make a really good case for why your loan should be approved when we know that ordinarily it may not be. We can also advise you on whether using a smaller deposit and paying off some loans may be to your advantage.

More of our popular pages that you may find interesting are listed below:
          95% home loans 
          Genuine and non genuine savings

To enquire about a home loan contact us.


Marty McDonald

About the Author: Marty McDonald is principal of mortgage broker “Mortgage Experts”. Marty specialises in assisting active property investors with loan structuring advice and implementation as well as helping credit worthy borrowers with slightly outside the box income and employment situations. Find Marty on  and LinkedIn.

What our clients are saying

    "Marty was fantastic! We swore never to use a broker again after bad experiences with other brokers in the past, and our last loan we negotiated ourselves, however this time we needed a mortgage... " – Blake Millgate
    "It is impossible to exaggerate how highly I rate Mortgage Experts and my experience with Marty McDonald... " – Brendan Arlington
    "Mortgage Experts have provided a fantastic experience in an area that can be complicated and emotional. Marty was always clear and precise and always made time to discuss the matters at hand... " – Brett Parker
    "I was really impressed with Marty's services. He was responsive to emails and calls, considered a range of options, and kept me informed at every stage. He was also very patient... " – Elise Darsow
    "Marty was great to deal with. From initial contact to finding a perfect solution and strategy to our situation to then securing the funding in a tight time frame nothing was too much trouble... " – Nick and Blaise Porter
    "Great service! All the advice I've received in the past has been really helpful. Love the newsletters which keep me updated on developments in the market. Highly recommended! " – Nick Jolly
    "I have used Marty's mortgage brokerage service (Mortgage Experts). He has been professional, resourceful, gone beyond the call of duty in servicing my mortgage. He has been able to... " – Prithvi Moses
    "We’re both really happy to have been able to get this sale across the line and are particularly grateful for you finding us a way to make the finance work! Walking into our new home... " – Sarah Macdonald & Stewart Bovell
    "We found Marty McDonald from Mortgage Experts through a Google search because he had a hugely informative page about family trust loans. Choosing Marty as our broker was a huge blessing... " – Tracey Cools

Our Current Lender Panel

Lex Luther Enterprises Pty Ltd (ABN 58114636949) trading as “Mortgage Experts” is an Authorised Credit Representative (444479) of Martin Warren Thomas McDonald, Australian Credit Licence (391230) under s64(1) of the National Consumer Protection Act 2009.