The Finance Bible

OD #6 - Don’t Buy a Property Until You Do This with Your Finances

• Zeke Guenthroth and Oscar Don

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Before you scroll through listings or rock up to another open home—STOP.
In this episode, Oscar Don, Co-Founder of Asset Road, breaks down the real first step in building wealth through property: getting your finance structure right.

Whether you're a first-time buyer or a future portfolio builder, this episode will walk you through:

✅ What lenders actually look at (not what you think)
✅ The five key parts of a strong finance profile
✅ How the wrong loan structure can block future investments
✅ Why working with a mortgage broker aligned with strategy is non-negotiable
✅ The exact steps to take before getting pre-approval

Oscar shares hard-won insights from years in the trenches with investors, brokers, and finance professionals—and shows you how to avoid the mistakes that cost Aussies thousands in lost opportunities.

If you’re serious about building long-term wealth through property, this episode is mandatory listening.

DISCLAIMER:

The information in this podcast is general in nature and does not constitute personal financial advice. It does not take into account your individual objectives, financial situation, or needs. Always consider whether the information is appropriate for you and seek advice from a qualified professional before making financial decisions.

💼 Book a free clarity session: assetroad.com.au

📲 Connect with Oscar on Instagram: @assetroad_

🔍 Check your credit score: Equifax | Credit Savy

🎯 Get started with your property strategy: Email info@assetroad.com.au


#PropertyInvestmentAustralia
 #FinanceStrategy
 #MortgageTips
 #PreApproval
 #InvestingInProperty
 #RealEstateFinance
 #InvestmentPropertyTips
 #BrokerVsBank
 #AssetRoad

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Speaker 1:

Welcome back to another episode of the Finance Bible Podcast. Zeke here and your co-host, oscar. But before we get into it, please note that nothing in this podcast should ever be considered as personal financial advice. Of course, if that is what you are seeking, reach out. We'll get you in touch with the correct professionals. Get the job done properly, sit back, relax and enjoy the show. Let's get into it. Welcome back for another episode.

Speaker 1:

Today you are with myself, oscar, and we're going to be tackling a part of the investment journey that's often overlooked. Generally, if it's overlooked, it's blown up in your face. So we're talking about finance, not just can I get a loan, but more about is your loan structured correctly? Does it support your own investment strategy? Can it grow with yourself and what you're wanting to achieve and not just get you into your first property? So, as you know, we at Asset Road and the Finance Bible we're more on the property side of things and we're not mortgage brokers, but we work hand in hand with brokers every single day to make sure clients' finances are set up correctly. And it doesn't just get the job done. It sets them up to actually scale and build an asset base to reach the ultimate goals of financial security and building a large amount of wealth to retire on. So this episode is about how that relationship works, what to get it right early and what most investors get completely wrong. So if you are planning to invest this year or you've already bought a property but you feel a bit unsure about your next move which I tell you what it's very common this episode is for you.

Speaker 1:

First part of the episode is we're going to talk about why you don't start with the property. Let's get this myth out of the way early. You don't start your property journey with property. I know that sounds quite weird coming from a property guy, but hear me out. A lot of people think investing begins when they start actually looking at properties and browsing listings and tending open homes if you're looking for an under-occupier or calling different real estate agents. But what if I told you, most successful portfolios start months and sometimes years before properties even on the radar?

Speaker 1:

We see people every week who have jumped into a property because it might have felt right or it looks good on paper and then only to find out later on that the way that they've actually funded the purchase has completely blocked them from growing a portfolio and pulling out the equity and going again and again and again. Why does that happen? Because that actual instance they didn't think about the impact of the finance structure on their future lending and what they're actually wanting to achieve down the track. So I'll give you a rough example. So imagine two investors who are both on the same income, same deposit level. One of them buys a $600,000 property without a plan, hasn't spoken to a mortgage broker, hasn't spoken to a team like Asset Road. The other individual sets up their own lending with a mortgage broker and looks at protecting their borrowing capacity and thinks two steps ahead of what they're wanting to do down the track. Fast forward, 12 months later, only one of them can afford to buy again, and it's not about who had more money, it's about who had the better plan. So your borrowing power is finite, your flexibility is fragile and unless you know how to leverage the bank's rules in your favor which a mortgage broker helps you understand you'll max yourself out before property number two and you'll never be able to move ahead, or if you can, it's going to be a long way down the track once you build a substantial.

Speaker 1:

That's why the first conversation we have with our clients is what are you trying to achieve, not just now, not just in 12 months, but five years, 10 years, 20 years, 30 years? What do you want to achieve for your family? How do you want to set them up? How do you want to structure everything? How many properties do you want? What's your income that you want, after tax, on an annual basis when you're not working? And, yeah, what's the timeline, how long are you giving yourself and what's your capacity right now? And that's where mortgage brokers come into it as well what smart finance prep looks like. So we'll dive into the nuts and bolts of this now.

Speaker 1:

Smart finance prep isn't just about turning yourself into an accountant. It's about understanding what banks look at and what brokers actually need to position yourself. Well, there are five key things that come up every single time in terms of the lenders, what they look at when a loan is lodged and the reason we know this. We work with brokers day in, day out, and this is, yeah, mainly the five things, and there can be other things which do come up. Might be self-employed when you're comparing to someone who's on a PAYG nine to five job, but these are generally the main five things, number one income and employment type. So banks love security. The more stable your income, the safer you look.

Speaker 1:

If you're a PAYG and a full-time worker, that is ideal for getting the lending. It's a lot easier. Mainly, what you've just got to do is confirm that you've been working there for a while, pass your probation period and give up-to-date pay slips and then you're genuinely good to go. If you're a casual or on probation, some lenders will say no, others are more flexible. This is where mortgage brokers come into it to identify the lenders which are more flexible. If you're in that position Self-employed this is where having a good mortgage broker really comes into it, because you need at least one full financial year of income, ideally two, depending on the lender. But even then there are some lenders taking BAS statements or just using accountant letters if your business is growing quickly. But yeah, you've really got to find a good broker if you are self-employed, especially if you're self-employed for a relatively new company, because there are ways to do it. You've just got to be partnered with the right people.

Speaker 1:

Number two living expenses and spending patterns. So lenders don't just ask what you spend. They need to look at it because you could go to them and say you don't need Uber Eats at all. You haven't had Uber Eats or delivery or anything like that for 12 months. But then they want to check your statements. Then all of a sudden you might purchase a grilled burger every second day on Uber Eats and all of a sudden you spend 10 grand a year on Uber Eats. So from a bank's point of view that's a red flag. But that Uber Eats bill, it does matter.

Speaker 1:

Gambling accounts let's say you're on sports bet or betting on the footy on a Friday or Saturday night. That matters quite a bit as well, because if that's a consistent thing in a large amount of money, the bank will think well, I'm not gonna give a loan to this person over here who's just gambling money away. And after pay zip, they are also important line of credit. All of it paints a picture we always tell clients live like you're applying for a loan three months before you actually apply, because that way your statements back up your story. Generally they only look at two to three months worth of bank statements. So if you do find yourself wanting to get into the property market but you're late in your afterpay bills, you're doing random gambling on a weekend and you're eating out a lot and getting delivery. Well, from this point of listening to this podcast, halt doing that for three months and then look at applying for a loan in three months with a clean bank statement, because that's what they look at.

Speaker 1:

Another important one. Number three your credit score. So your credit score is basically your financial report card. One missed phone bill can drop you 50 points, believe it or not. Too many credit inquiries, such as applying for credit cards day in, day out to get these points, that also looks like a risk in the bank's point of view. But if you are worried about your credit score, you can check it online for free. Top of mind websites Credit Savvy's good, and Equifax. You can also look it up there. But if you've got a low score or defaults, it's not necessarily game over, meaning you can't borrow, but it would just limit your options. So the earlier you see it, the more time you have to fix it before you apply, basically like the bank statements situation as well.

Speaker 1:

Number four existing debt. This one surprises people the most. It's not just about how much debt you have. It's how lenders treat the debt that you have, for example, that credit card that you never use, with a $15,000 bank limit, banks assume it's maxed out so that $15,000 is going to go against your borrowing capacity. Your car loan $700 per month out of your budget. Your personal loan for a holiday two years ago that is still dragging your borrowing power down. You need to look at cleaning the house of debt first before you apply, because existing debt, if it's not investment debt, is yeah, it's, it's a. It's a bit of a red flag for the banks. You just got to kill the unnecessary stuff so your money is working for you, not against you.

Speaker 1:

Number five you need to show that you have genuine savings and good conduct. So lenders want to see that you've saved money over time. If your deposit came from a family gift or some crypto, that is fine, but genuine savings still matter. So they want to see that you probably you know three, four, five months of consistent savings and deposits into your savings account that they're able to identify that you are a good saver. They want to see consistency. So no chaos at all, no random sums every two months or every four weeks, just randomly here and there. So regular transfers. They want to make sure that you're disciplined in your budgeting and a buffer will help. So if you need, let's say, $60,000 as a deposit. Ideally you have 70,000. So you get a bit of a buffer.

Speaker 1:

So let's talk about pre-approvals In a simple way of explaining it. It is basically your green light to invest, to buy a property, to buy that owner-occupier. Pre-approval gets talked about a lot but it's still misunderstood. So you should not be making offers or bidding at auctions without a pre-approval. In my opinion, why? Pre-approval confirms you're borrowing a limit. It protects you from wasting any time. It gives you the leverage in negotiation. If you're speaking to an agent and you're bidding against someone who doesn't have a pre-approval, generally it's a lot better because the bank's already approved you technically speaking and in the fast-moving market it lets you act decisively, not reactively, which is very important. We've had clients in, for example, perth a year ago and over in southeast Queensland literally win the property that they want purely because they were pre-approved and ready to actually move and everything was in line. So they were competing against other people who weren't pre-approved and they were still waiting to hear back from the bank. So that just shows that a pre-approval will give you a bigger edge over your competition, but it's not a guarantee.

Speaker 1:

If you're wanting to look at a pre-approval. This is where having a chat with your mortgage broker is good, because they'll look at everything we have spoken about just before. They'll look at your expenses, they'll look at your conduct, they'll look at your credit score, everything like that, and then they'll basically pop in what your max borrowing capacity would be. So let's say, for example, you're wanting to purchase a property worth $700,000 and you're wanting to borrow, let's say, 80% of that. They will crunch the numbers for you and then, if you can do it, they'll come up and say all right, so we can get a pre-approval for you for a $560,000 loan, which is 80% of the purchase price that you're wanting. And then, once you actually get the property that you're looking for and you've got the pre-approval and you put the offer in, that's where they'll start actually getting the remaining documents and everything in place to get it formally approved and actually push it through for you. So it gives you an idea of what your budget will be as well, because there's nothing worse than, let's say, you think you're pre-approved for $700,000 purchase price and you're looking for those properties and then all of a sudden you get a rude shock that you can only go to $600,000. So you've been wasting all this time, and especially in the market at the moment, how quick it is. With all the interest rate drops which have happened and also going to happen even more, you're going to miss the boat. So definitely get a pre-approval. Speak to your mortgage broker about that, because it is extremely important, believe it or not. So let's wrap it all up If you're serious about investing in the next six to 12 months, your job isn't to get lucky's to get ready. So here's a quick checklist that you may need to do if you are in this boat.

Speaker 1:

Number one start reviewing your expenses. Set up a spreadsheet or a budgeting app. There's so many on the app store and if you're apple not sure about samsung or whatever it's called these days android, but I'm sure it's the same there. Also, if you go on Google, you can suss it out there's heaps of different spreadsheets you can download for free. You can also check your credit score, which is point number two I mentioned before. You can go on Credit Savvy and Equifax.

Speaker 1:

Number three start saving or building a buffer, so even small amounts. I know with ING Bank and a lot of actually banks, you can do automated roundups. So that's what I found in the past, really easy to use and actually very handy. So let's say you spend a coffee and it's $4.85. 15 of the cents, which is round up to five bucks, will get transferred to your savings. And yes, it's 15 cents, but over time you're going to make a bit of money in your savings which you wouldn't have actually put in your savings in the first place. So that just helps.

Speaker 1:

Number four very important chat with Zeke and myself at Asset Road. We can help you map out your goals and strategy and, most importantly, connect you with a broker we trust and who has record in the past of actually helping clients get pre-approvals and moving them forward and getting the property of their dreams or investing in the property that they want. To make the money. They help you align the finance with a plan, which is the most important factor.

Speaker 1:

This whole process of these next steps in the checklist, this process will build clarity for yourself which reduces fear, and fear is what keeps most people out of the market, not money, it's the fear of unknown. And doing this for quite a while, we found that there's so many individuals out there who say they're going to do it. Six years later they're still saying they're going to do it. You've just missed out on the six years worth of growth on a property that you could have had In that time. If you bought in the correct spot, you could have two, three, four different properties now from that one investment. But because you're sitting on the sidelines and waiting until the market drops or waiting until another day, or you just keep telling yourself a lie, you are going to miss out on a lot of opportunities. So get this checklist done.

Speaker 1:

If you're serious about investing, get it sorted out and speak to the team. But at the end of the day, property investing isn't just about freedom. It's about giving yourself options, choices, control over your time but, most importantly, in my opinion, your own future. But freedom doesn't come from just winning it. It comes from structure, guidance and from getting the finance part right before you get emotional about a deal. Because a lot of people myself included before you find a property you like and you get all emotional about it and then you miss out on it and you're bummed, you're upset, you're not happy about it, you don't want to buy another one, you keep thinking about it. So get the finance part right and then, if you really want to, you can get emotional, but if you're investing, get the emotions aside. So if you are ready to step into the game seriously, I've popped a link in the show notes below or visit our website assetrowcomau. Book a call. We'll have a conversation. Get the finance sorted first if you are serious, because without the finance, I hate to say it you might continue to lose out. But until next time.

Speaker 1:

We hope you enjoyed the episode. As always, you know exactly what to listen. But until next time, ciao. We hope you enjoyed the episode. As always, you know exactly what to do. Hit that follow button, subscribe, whatever platform you listen to this podcast on. Also share it to friends, families, co-workers, whoever you think may benefit from it. But unfortunately it's the end and we will see you next week.

People on this episode

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Oscar Don

Co-host
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Zeke Guenthroth

Co-host