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The loan-to-value ratio is based
on the bank’s valuation or the purchase price, whichever is
lower.
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» size of loan ...
The size of the loan in relation to the
value of the property, i.e. loan/security or loan/value ratio,
varies between lenders and may be as high as 80% to 90%.
Typically, banks offering currency
switching facilities will be more conservative in this respect
owing to exchange rate risk. 70 to 75% maximum loan is the
norm in these circumstances though 60% to 70% is commonly
encountered.
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The loan-to-value ratio varies between lenders.
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» factors which determine loan
quantum ...
Other factors which the lender takes into consideration when
determining the maximum loan quantum are:
- Applicant’s annual income.
Lenders calculate the
maximum loan size as a multiple of the applicant’s
pre-tax annual income.
- Net disposable income.
Lenders have a notional
figure in mind for minimum net disposable income after
servicing the loan and this may or may not take
anticipated rental income into consideration.
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Factors which the lender takes into consideration when
determining the maximum loan quantum are the applicant's
annual income, net disposable income and age.
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» increasing the loan
quantum ...
Borrowers looking to borrow a larger part of the purchase
price may consider:
- Providing other properties as additional security;
- Cash-backed or investment-backed arrangements where
deposits or investments are placed with the lender and the
borrower borrows back part of their value.
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