Can I use my brother as my guarantor?

Any general questions you might have in regards to loans and finance.
Amando
Posts: 4
Joined: Fri Apr 12, 2019 2:33 pm

Can I use my brother as my guarantor?

Postby Amando » Fri Apr 12, 2019 2:35 pm

Hello there,

I was wondering if you could help me out with my situation! So I’m planning to buy a house around September. Unfortunately, I don’t have any genuine savings at the moment. I asked my parents if they would be willing to be my guarantors but they declined. I don’t blame them! I’d probably reject myself as well at this point. However, my brother has agreed to help me out by acting as my guarantor. I heard that banks only allows parents as guarantors. I was wondering if you could clear this out for me!

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Otto Dargan
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Re: Can I use my brother as my guarantor?

Postby Otto Dargan » Fri Apr 12, 2019 3:05 pm

Hi Amanda,

Welcome to the forums.

Most lenders tend to be very specific with who they accept as guarantors. Most banks only allow guarantee from the borrower’s parents.

However, there are selected lenders who can consider guarantees from immediate family members such as siblings, grandparents, spouses, and de facto partners as long as they are over the age of 18.

Friends, workmates or associates aren’t normally accepted because the banks want to make sure that the guarantor has a strong relationship with you.

Our mortgage brokers are experts in guarantor home loans. Please call us on 1300 889 743 or fill in our free online assessment form and we can go through your options.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Amando
Posts: 4
Joined: Fri Apr 12, 2019 2:33 pm

Re: Can I use my brother as my guarantor?

Postby Amando » Fri Apr 12, 2019 3:34 pm

Sure thing!

Before I call you, I have a few more questions for you. I have done some research but could you brief me on the top benefits of having a guarantor? Why is guarantor loans so popular?

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Otto Dargan
Mortgage Specialist
Posts: 7339
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
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Re: Can I use my brother as my guarantor?

Postby Otto Dargan » Fri Apr 12, 2019 3:36 pm

Hey Amanda,

Guarantor loans have several benefits for you as the borrower:

- You don’t need a deposit, allowing you to buy a home now.
- You can save money by not paying a Lenders Mortgage Insurance (LMI) premium.
- Discounted interest rates are available from some lenders.
- You can consolidate some minor debts, such as credit cards, when you buy your home.
- You can limit the size of the guarantee.
- You can borrow 105% of the purchase price.
- You can borrow 110% if you have any debts to consolidate.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Amando
Posts: 4
Joined: Fri Apr 12, 2019 2:33 pm

Re: Can I use my brother as my guarantor?

Postby Amando » Fri Apr 12, 2019 3:40 pm

Cool! I’ll need to consult with my brother before moving ahead with this. One last question! Does my brother need to worry about anything by being my guarantor?

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Otto Dargan
Mortgage Specialist
Posts: 7339
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: Can I use my brother as my guarantor?

Postby Otto Dargan » Fri Apr 12, 2019 3:45 pm

Hey Amanda,

Excellent question!

Guarantors are ultimately liable for your home loan in case that you default.

The reality is that banks try everything to solve whatever problem that you might be facing before moving to sell the guarantor’s home.

The bank knows that it will struggle to break even by going down this path so they would much rather that you keep paying your mortgage.

To do this, they will want to work out why you’re having trouble managing your repayments and whether a solution can be found.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Amando
Posts: 4
Joined: Fri Apr 12, 2019 2:33 pm

Re: Can I use my brother as my guarantor?

Postby Amando » Fri Apr 12, 2019 3:48 pm

Please call us on 1300 889 743 or fill in our free online assessment form and we can go through your options.


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