Map Out Your Mortgage Destination Before You Start Your Investing Journey

A key component of building a successful portfolio of real estate investments means having to effectively manage lender/bank relationships. The fact is getting the first couple of doors is actually quite easy as there are many lenders and options. The information you have is quite easy to manage and relatively simple for lenders to understand at the onset. As your portfolio grows, so does the complexity of your situation and the volume of paperwork. For this reason, many lenders will conduct a field examination in order to ensure that lending options are the best for customers.

Like most financial goals the key to achieving the final goal is to break the plan into manageable pieces while keeping the end goal in mind. Building a profitable real estate portfolio is as much about minimizing your overall costs of borrowing as it is about maximizing revenues. In the early days almost everyone will lend to you, but as time goes on the list of lender conditions grows while the list of available lending options gets smaller. Our team is often retained for the restructuring of client mortgage portfolios because mortgage professionals who have not thought through the big picture have used up the easy lenders early and caused these same lenders to be unavailable based on portfolio limits when we need them most as your portfolio grows.

The purpose of the pre-purchase consultation is to determine which of the categories you fit into:

1) Based on what we have reviewed, you are in a position to buy more real estate investments;
2) Based on what we have reviewed, we will need more detailed information or you will need to make some simple changes before we can ensure you can that you can buy more real estate investments; or
3) Based on what we have reviewed, you will need to follow an action plan that can get you there within 6 to 12 months. This is common with tax issues, estate issues, locked in investments, credit issues etc.

What s the difference between Pre-Positioning and Pre-approval?

A pre-approval is typically used for owner-occupied properties only. Since buying a rental property involves cash flow, the debt service ratios cannot be calculated until you know the rental income on the property you are buying. As such, it is impossible to get pre-approved when buying a rental property.

What should I do?

It is critical to have a Pre-positioning conversation with your Mortgage Broker and take into account the impact of cash flow on your next purchase. Once you have filled out the information on the back side of this page, we can analyze your portfolio from a 3000 foot view. A proper consultation will allow you to see the obstacles before you encounter them and position you to not only make your next purchase but achieve your long term goals as well.

Download your own copy of the Calum Ross Mortgage Pre-Positioning Consultation Form.

Calum Ross will be speaking at the upcoming ACRE Live Program in Calgary on March 8 & 9. His mortgage team will also be on site at the event offering mortgage consultation and making themselves available to answer any mortgage questions you may have.