Three Eggs In One Basket

[robyno]

Hello Everyone,

I will be purchasing my third rental within the next couple of months.
My PPOR is paid off and I have two apts with IO loans from one bank. Should I approach this bank for the next rental or should I pick on someone else?
I had heard that by the time you were on to your third rental you should not place all your eggs in one basket, in case they get snippy and ask for their money back.
Is this correct or are there any other reasons?
Thank you

[fudosan]

Hi robyno,

A warm welcome to PT.

If you have excellent LVR (loan to value) and DSR (debt servicing ratio), I see no reason why any lender wants to refuse your business. Banks' main concerns are to make sure their outstanding loans can be well serviced and in case of default the loans can be retrieved intact. If you are not sure of your LVR and DSR, talk to a mortgage broker. Having said that, I think banks are getting stricter on lending to apartments in Auckland CBD.

[CJ]

Do to a broker and get the best deal (or to BNZ for their unbeatable). WHile cross collateralisation is not to much an issue in your current situation, if you can avoid it, you may as well. Will make you more flexiable in the future.

[robyno]

Three Eggs In One Basket

Thanks to Fudosan and CJ for your quick replies. You have certainly helped me make my decision.

Robyno