Profitable property investment is subject to accurate knowledge about a lot of things.
For example:
Complete and accurate knowledge about the best property investment practices.
Purchasing any investment property for sale cannot be possible without complete knowledge about political and financial market happenings. You have to keep your eyes fixed on events like Brexit and newly introduced mortgage rules. Their outcome definitely affects the property investment market and your ROI too.
• Types of mortgages.
• How to take out mortgage?
• The type of investment property for sale to purchase.
• The type of auction events to attend as per your investment strategy.
• Property investment funding options.
• How to get your property investment financed or funded?
• How to devise a foolproof exit plan?
• What to do if your investment plans do not work in your favor?
A lot of property investment agents in London are often seen advising/guiding new investors about such topics. But there is one topic that is hardly touched by most of the agents. This is DTI (Debt-to-Income Ratio).
What Exactly is Debt-to-Income Ratio?
If you are likely to purchase a residential investment property for sale then you must understand this concept fully.
DTI (Debt-to-Income Ratio) is actually the total of your monthly revolving and installment payments, which is further divided by your GMI (Gross Monthly Income).
What is GMI?
Gross Monthly income is the pay earned by employees before tax and other deductions.
The Importance of DTI:
According to the experienced property investment agents in London, DTI helps private lenders or financial institutions determine whether your loan application should be approved or disapproved. Given below are some very important points considered by them before approving or rejecting your application for loan:
• Your current monthly or yearly income.
• Your current credit score.
• Ability to repay the mortgage in time.
• Other mortgage/financial obligations.
In case your some lender or financial institution denies your mortgage/loan application then you should blame your poor debt-to-income ratio for it.
That’s not the only thing you should know about DTI. If you are planning to purchase some residential investment property for sale then you will need to learn about many more important things about it. For example:
• What type of monthly bills are taken into consideration by lenders to determine your debt-to-income ratio?
• What type of monthly bills lenders do not consider to determine your DTI?
• What is good DTI?
• What is considered as Income in debt-to-income ratio?
• Can your mortgage or loan application be approved on the grounds of low DTI?
• Is it really possible to lower DTI to get better interest rates or loans/mortgage?
Now, you seem to be all set for leaning about DTI (Debt-to-Income Ration) prior to investing in property in the UK. You should attend a couple of seminars and also get in touch with some experienced investors or agents who are willing to share their knowledge and experience in this regard with you.