Background
Rachel was working in local hospitals as an agency administrator since 2019. She went onto the books during this period and then realised she’d make more income going back to agency self-employed to switched back after 6 months and has since been self-employed for the last 18 months.
She recently went through a difficult divorce which was sensitive to manage and we needed to hit some goals before the divorce deadline in 7 months time.
The key factor was she needed to lodge a higher tax return to pass servicing, pay off some credit cards and a personal loan, however during the difficult times of her relationship she missed a few payments on a credit card due to stress / administrative error which was causing problems with a lot of lending options.
Rachel wanted to refinance as part of divorce proceedings and release some funds to upgrade the property to turn it into an investment so she could keep the family home for the future and maybe once the dust had settled and the kids got a little older she could move back into it.
The challenge
She had below average Equifax score which is 50/50 for an instant decline with some lenders and her income alone was not sufficient to afford the loan amount.
Her small stint of employment in 2022 was chopping her income in half as she was now “self-employed” and the lenders weren’t allowing the employed portion to be utilised for borrowing power.
She needed to pay down the credit cards / loans and increase her income by 30% over the next 6 months to get in with a chance of keeping the property.
Even though she had worked really hard, we needed to get exemptions completed and also find out which lender would take this file on. Long term she’s been great at repaying the mortgage with her ex and has simply gone through some slip ups.
We needed a lender that would understand the situation and give her chance to get back on her feet.
The solution
After consulting with Strategic Brokers, we devised a plan she was happy with and felt was achievable over a 6 month period.
She was confident she could close the credit card, which she did after 2 months and then also now had family support as she moved in with parents to help with the kids so this meant she could comfortably complete more hours at work.
We consulted with a lender that was willing to over-look the missed payments on the card as it was over 6 months ago and the card was now closed. The credit score wasn’t going to be a problem.
The outcome
Rachel refinanced the property and put it on the market in October 2024.
She still works for the hospital and has the support of her parents with the kids and plans to pay down the loan as quickly as she can with her income and the new rental income from the property.
A huge weight off her shoulders knowing she has something for the future which will assist with her own retirement and the kids in the future when they need to get onto the property ladder
Let us help you achieve your home buying dreams like we helped Rachel.
We’re experts at assisting people with unusual circumstances or in a tricky spot.