Appy on any budget

Track your spending via technology and boost your chances of getting a good loan, writes

FIXED PLAN: Alyson Kett, with sons Samuel and Oliver, has locked in a new energy plan for two years.

Anthony Keane

BORROWERS who embrace apps and budgeting technology that tracks their spending are giving themselves a better chance of grabbing a good loan amid a crackdown by regulators.

Stricter rules around loan serviceability means people able to prove what they spend are getting the upper hand.

Financial regulator APRA last month called for more realistic living expense details on loan applications and increased vigilance by lenders.

People’s Choice Credit Union spokesman Stuart Symons said reliable records were becoming increasingly important, and borrowers could help themselves “by being on the front foot”.

“If you can’t show what you spend, a lender may look instead to an estimate that shows a higher level of spending, and therefore allow you to borrow less,” he said.

There are several free and paid apps and budgeting software available, including the Australian Securities and Investments Commission’s free TrackMySPEND, Pocketbook, Pocket Expense and bankrelated apps.

“Online and app store reviews are the best place to start as they will highlight the features that may work best for you, and the limitations that may rule it out,” Mr Symons said.

“You will probably also find that you will become more aware of your spending and cut back where you can, which means additional cash for the things you value.”

Mr Symons said people should also consider automatic backup of their data and security issues.

Mortgage and consumer finance specialist Lisa Montgomery also said security and using trusted technology was important. Reading online forums could help you compare, she said.

“Technology is making it easier, and don’t forget that they’re using technology too to find out about you,” Ms Montgomery said.

“Anomalies will cause your application to be held up or not be approved, so it’s important to have really clear records,” she said.

Another key step is to check your credit file with an agency such as Equifax, Experian or Dun and Bradstreet. “It’s free and easy and gives you a building block to capture all your other records – sometimes you don’t know what could be appearing on that. It could have been put there by mistake,” Ms Montgomery said.

“Information gives power to the borrower.”

Mr Symons said all lenders were now taking a similar approach to serviceability.

“This includes how much overtime earnings and casual earnings are to be included as ongoing, how the serviceability of existing loans is assessed, and the fact that people on higher incomes are likely to spend more money,” Mr Symons said.