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Re: Applying for a low deposit loan

Posted: Tue Feb 05, 2019 7:22 pm
by Otto Dargan
Hi Rene,

Welcome to the forums.

Most lenders require that you have at least a 5% deposit in genuine savings to apply for a loan. It looks like you’re just around $5,000 shy to apply for a 5% deposit home loan.

As a first time buyer, you are eligible to apply for a first home owners grant (FHOG) which might be enough to cover the deficit.

You can use our first home grant calculator to work out which government benefits such as grants and stamp duty exemptions that you may be eligible for.

With a 5% deposit, however, you are required to pay the Lenders Mortgage Insurance (LMI), which can amount to more than $14,000 if you were to have a 5% deposit on a $500,000 property.

Give us a call on 1300 889 743 or fill in our online enquiry form to find out if we can get you approved.


Cheers,
Otto

Re: Applying for a low deposit loan

Posted: Tue Feb 05, 2019 7:54 pm
by Otto Dargan
Hey Rene,


A Lenders Mortgage Insurance (LMI) premium is charged by the lender when you borrow over 80% of the purchase price.

Unfortunately, you’re required to pay LMI unless you can put down 20% of the purchase price as a deposit.

If you are looking to skip paying LMI, you can go for a guarantor home loan.

Irrespective of how much you have saved up, a guarantor loan allows you to borrow up to 110% of the property value.

You can also avoid the cost of Lenders Mortgage Insurance (LMI).


Cheers,
Otto

Re: Applying for a low deposit loan

Posted: Tue Feb 05, 2019 8:46 pm
by Otto Dargan
Hey Rene,

Only selected lenders approve low deposit home loan applications. Major banks don’t usually approve them.

For borrowers with a 5% deposit or less, we tend to try for a non-bank because they are:

Less restrictive in their requirements.
There tends to be little difference between their interest rates and a bank.
Sometimes we hear about a special offer that far outweighs anything a bank can offer.

Please call us on 1300 889 743 and we can tell you how we can help.

Cheers,
Otto