As a permanent resident, can I get a home loan in Australia?

Any general questions you might have in regards to loans and finance.
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Bruce
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Joined: Thu Jun 20, 2013 6:21 pm

As a permanent resident, can I get a home loan in Australia?

Post by Bruce »

Hi,

I am a citizen of New Zealand but I’ve recently got a Permanent Residency. I work as a Senior Accountant and roughly make 90k per year. I have been working with the same company for about five years now. My wife is an Australian citizen who works as an Art Teacher and earns around 62k annually.

We want to get a mortgage to buy our first house together. We have no children and live a really simple life which has allowed us to save around $100k.

As a permanent resident, can I get a home loan to purchase a residential property? Any word on this is greatly appreciated.

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Otto Dargan
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Re: As a permanent resident, can I get a home loan in Austra

Post by Otto Dargan »

Hi Bruce,

Thank you for the post.

As a permanent resident you are eligible to apply for a mortgage to buy a house. However, it is not compulsory for your wife to be the co-borrower in the mortgage which would have been mandatory if you were a temporary resident.

Since you already have a permanent residency, you will be treated in the same way as an Australian citizen while assessing your home loan application. You can borrow up to 90%-95% of the property value and 100% of the purchase price with a guarantor.

Have you looked at any properties yet?

Cheers,
Otto
Otto Dargan
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Bruce
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Joined: Thu Jun 20, 2013 6:21 pm

Re: As a permanent resident, can I get a home loan in Austra

Post by Bruce »

Thank you Otto. Yes, we have a house in mind at Port Augusta West, SA 5700 which is priced at $363,900. I’ve already told you that we have saved $100,000 to be used as deposit. I also wanted to know whether I am eligible for First Home Owners Grant?

Thanks.

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Otto Dargan
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Re: As a permanent resident, can I get a home loan in Austra

Post by Otto Dargan »

Hi Bruce,

From the details, the loan amount you would be borrowing is almost 72% of the property value. This should not be a problem since permanent residents living in Australia are eligible to borrow almost 92% of the property value.

However, lenders would want to see 5% of the purchase price in genuine savings i.e. at least 5% should have been saved in your savings account for more than three months. You will also need to keep aside some extra funds for stamp duty (the rates differ from state to state) and other loan set up fees.
Bruce wrote:I also wanted to know whether I am eligible for First Home Owners Grant? .
Yes, as a matter of fact, you are eligible to for First Home Owners Grant (FHOG) benefit. You should consult your state government’s first home buyers website to know exactly which benefits are available to you.

After that, you can talk to one of our mortgage brokers who can carry a sound knowledge and experience in mortgages for permanent residents. You can contact us at 1300 889 743 or send us an enquiry and we will get back to you.

Cheers,
Otto
Otto Dargan
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P | 1300 889 743
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sandysmith
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Joined: Thu Jun 27, 2013 9:19 pm

Re: As a permanent resident, can I get a home loan in Austra

Post by sandysmith »

Hi everyone,

I have recently been approved as a Permanent Resident. :) I am here on a Spouse visa and my husband is an Australian citizen. I wanted to know does my immigration visa status differ when applying for a mortgage.

Thanks.

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Otto Dargan
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Re: As a permanent resident, can I get a home loan in Austra

Post by Otto Dargan »

Hi sandysmith,

Even though you arrived on a spouse visa, you are eligible to get a home loan. Your immigration visa type does not really make a difference because you will be treated as permanent residents when it comes to assessing your mortgage application.

Please feel free to ask any other questions you have.

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

Bruce
Posts: 34
Joined: Thu Jun 20, 2013 6:21 pm

Re: As a permanent resident, can I get a home loan in Austra

Post by Bruce »

Thank you Otto. Yours answers have been really helpful. I will call soon. :mrgreen:

sandysmith
Posts: 47
Joined: Thu Jun 27, 2013 9:19 pm

Re: As a permanent resident, can I get a home loan in Austra

Post by sandysmith »

Thanks for that Otto.

Just a quick question, do I need to get an approval from Foreign Investment Review Board? Some of my friends say I do whereas some say I don’t and it’s getting really confusing.

I think I forgot to mention earlier, I have a house in Seattle, US which I have rented out to my sister and her family. I earn monthly rent income from there as well. Will this be an issue for the lenders? Also, could you please give me an idea about costs I need to know before purchasing a property?

Thanks.

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Otto Dargan
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Joined: Sat Sep 06, 2008 5:55 pm
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Re: As a permanent resident, can I get a home loan in Austra

Post by Otto Dargan »

Hi sandysmith,

No, since you are already a permanent resident you do not need an approval from Foreign Investment Review Board (FIRB). When it comes to your foreign income, not all lenders will accept it as a reliable income source to repay your debt.

However, we know lenders who can accept your foreign income to be used to pay for the monthly repayments. They will have no problems with it as long as you do not miss or make late repayments.

As for property purchase costs, you need to have 10% of the purchase price as the deposit and expect to spend at least 5% of it on costs and charges such as stamp duty, transfer fees and other governmental/loan set up fees.

You need to make sure you have enough funds to cover the costs because lenders can decline your mortgage if they feel your deposit is not adequate. They will think you do not have a steady flow of income to support the mortgage later on as well.

If the amount you are borrowing is over 80% of the property value, then you need to pay Lenders Mortgage Insurance (LMI) fees. This fee is paid once to protect the lenders in case a borrower defaults on the mortgage.

If you would like more information, please contact us at 1300 889 743 or enquire online and we will get back to you.

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

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