Mining job & own business. Can we get a home loan now?

Any general questions you might have in regards to loans and finance.
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sunny03
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Joined: Fri Sep 03, 2010 1:51 pm

Mining job & own business. Can we get a home loan now?

Post by sunny03 »

Hi, just wanted to check to see if we could get a homeloan now. My husband and I previously owned a house. We are looking to buy again. We own our own business and my husband is working away at the mines. We currently earn around 60k gross from the business and my husband earns 70k from his job. We have excellent credit history. We want to borrow around 360k. We have around 12k in savings. We have my husbands brother who is willing to go guarantor but currently has a mortgage on his property and only casual wages. But has about 80 to 90k in equity built up in his property. We have 6k in credit card and 23k personal loan. We have 1 dependant. Should we wait a little longer or could we possibly get a loan nowish??

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Otto Dargan
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Re: Mining job & own business. Can we get a home loan now?

Post by Otto Dargan »

You should be eligible for a home loan, however not just yet. A guarantor loan will not work for you at present as your brother doesn't have enough equity in his home. Ideally for a guarantor loan to work you want the guarantor to owe 40% or less of the value of their property (just a rough guide). We'll be creating a calculator soon for our website which will allow you to work out if the guarantor has enough equity.

Your savings are good however for you to apply on your own you will need to have a minimum of 5% of the purchase price in genuine savings. My recommendation is that you pay off your credit card debt, and then continue to save until you have 5% in genuine savings. We should be able to get you a 95% LVR home loan, however you will need to cover the stamp duty and conveyancing costs so you will need around 9% of the purchase price in funds, of which 5% will need to be genuine savings, the rest can come from a gift or other source.

The other alternative is to find another guarantor, ideally one of your parents. If they have equity in their property then this is a possible option. Please ask your parents to read our page on guarantor home loans so that they can understand the process and the risks involved.

We commonly help people working in the mines, note that contractors in the mining industry are not looked on favourably by many lenders. This is because although miners earn a great income, there is often employment instability or they often work a long way away from home and decide to change employment to suit their lifestyle. We still have a few lenders that can approve home loans for miners.
Otto Dargan
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P | 1300 889 743
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sunny03
Posts: 2
Joined: Fri Sep 03, 2010 1:51 pm

Re: Mining job & own business. Can we get a home loan now?

Post by sunny03 »

Thankyou for your information and advice. At least now we know where we stand. Your help is greatly appreciated. Just another question is there any lender that will use the business as security for a home loan. We dont have a business loan or overdrafts, we are a cash only takeaway shop worth around 195k. (Hence where our money went after selling our house). :?:

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Otto Dargan
Mortgage Specialist
Posts: 7730
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
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Re: Mining job & own business. Can we get a home loan now?

Post by Otto Dargan »

If you own the commercial property the business uses then you may be able to use that as security for a business loan. However the business itself is unlikely to be accepted on its own. Banks like to have a readily saleable property as security as it is hard for them to sell a business to recover a debt.
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

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