Overview

Contribution Funds section in Loanapp requires you to add amounts and sources of funds that are going to be used to complete the transaction. These funds are used to make up the difference between the amount required for the transaction and the borrowed amount. In this article, we will go through a series of scenarios and show you how to add Contribution Funds for each.

This article will explain how to enter Contribution Funds when:

If your application is for a simple property purchase then all you need to do is add your New Purchase property under New Requirements - as this will be your security.

Then go to Contribution Funds to add the amount and source of funds that are going to be used to complete the transaction. 

N.B: Contribution Funds should always be added as assets in "Other Assets" section. For them to be nominated as Contribution Funds, they should be added here as well. These are also known as Funds To Complete. So for instance, if the applicant has a Savings account with a balance of $100,000 that they'd like to contribute towards their purchase, simply add it in Other Assets like so:

Then go to Contribution Funds to specify some or all of that amount, that's being contributed from the Savings account which was entered as a current asset. 

In the case that you have your contribution funds in multiple savings accounts. Simply add them all in Other Assets and put the total of the funds you're contributing in Contribution Funds. 

                                      _______________________

You may already own an Existing Property with a mortgage over it and have applied to increase this facility with that lender, with the purpose of using those funds to purchase another property. Assuming you've obtained approval, all you now need to do is specify that your contributions are from Equity in an existing property. 

Firstly, you'll need to Add the Property Asset you own under Current Situation.

Make sure To Be Used As Security field is set to No, as in this scenario, we are only using the equity from this property. The new mortgage will be secured by the new purchase, 

Then you'll have to add the Mortgage Liability in and ensure you include the approved increase amount you've applied for with the existing lender. This is displayed in the Outstanding Balance field. For example, if you're loan was $200,000 and you've increased the facility by $100,000 more for the purchase, then your balance would be $300,000 - like so:

You'll now have enter in the New Purchase property you're buying. You'll find this under New Requirements. Make sure you select Yes to Primary Security.

Once you've completed the New Loans tab, you'll need to move on to the Contribution Funds. Here you'll need to select Existing Equity from the drop-down menu. 

And enter in the amount that you increased your existing facility by, for the purpose of this loan. In this example, it was $100,000. 

Remember: You can always add a comment for the lender to further explain your entry. You can do this by clicking on the Comment button anywhere you see it on Loanapp. Find out how here.

                                      _______________________
​