Can I get a home loan with a gift as a deposit?

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mochiXmochi
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Joined: Tue Aug 10, 2010 1:59 pm

Can I get a home loan with a gift as a deposit?

Post by mochiXmochi »

Hi, I need help in buying my first home. I've just graduated from studies so I am yet to have that much savings. My dad will be providing me with a gift to help with my purchase. Can this be use as a deposit for my home loan?

Thanks! :)
Ashley.

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Otto Dargan
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Location: Sydney, Australia
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Re: Can I get a home loan with a gift as a deposit?

Post by Otto Dargan »

Yes it is possible to get a home loan with a gifted deposit. Around 60% of first home buyers get some kind of help from their parents be it a guarantee for their loan or a gift to help them enter the property market. Without this help it can be very hard to get a head start.

As a general rule, most lenders will not allow you to borrow over 80% of the property value unless you have saved at least 5% of the deposit on your own. If you do not have this 5% saved then you will need to apply for what is known as a no genuine savings loan.

We have lenders that can consider lending you 85% or even 90% of the purchase price with a gift as a deposit. They do not charge a higher interest rate either!

We also have one lender that can consider lending 95% with the rest coming from a gift however they are so strict that only around 10% of the people who we speak to can qualify for a loan with them. I'd recommend that you apply for a 90% loan instead.

Your parents will need to provide a gift letter to confirm the amount that they are giving to you, the purpose of the gift and that it is not repayable. Some lenders will require a statutory declaration or proof that the funds are in your bank account, others just require a letter.

We can help you to apply for a home loan without any savings, please give us a call on 1300 889 743.
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

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