Can a discharged bankrupt get a home loan?

Any general questions you might have in regards to loans and finance.
Ajjary
Posts: 9
Joined: Tue May 29, 2018 2:40 pm

Can a discharged bankrupt get a home loan?

Postby Ajjary » Wed Jun 13, 2018 2:10 pm

Hi Team.

I was listed as a bankrupt due to some family event some years ago. I was discharged from bankruptcy last June year. We are looking for a property in Bankstown in the range of $600,000. It’ll be our first home.

I have $50,000 in the bank, and I can use all of it as a deposit. I earn $80,000 and my partner earns $50,000. Would I have a chance of approval or you think $600,000 is too much to borrow for me given my circumstance? Also, can you let me know whether I need to pay higher interest rate because of this?

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Otto Dargan
Mortgage Specialist
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Re: Can a discharged bankrupt get a home loan?

Postby Otto Dargan » Wed Jun 13, 2018 3:27 pm

Hi Ajjary. Welcome to the forums.

Lenders allow discharged bankrupt to borrow up to 90% of the purchase price of a property. However, you’ll need 14% to 16% of the purchase price to cover your deposit, stamp duty and Lenders Mortgage Insurance (LMI).

Regarding interest rates, in most cases, you’ll pay a higher interest rate for your loan. Luckily, we’ve agreed with some of our lenders to obtain regular home loan interest rates for customers who are now in a good financial position.

Discounted rates may be available if:
  • Your loan is for no more than 80% of the property value.
  • You can give evidence that you now pay your bills on time, e.g. a rental history.
  • You can provide evidence that the bankruptcy was a one-off event that wasn’t your fault.
  • You’ve been discharged for a particular period, e.g. one year.
The only way to cut interest rates to have a larger deposit. The more deposit you have, the lower the loan to value ratio (LVR) is. Your loans LVR will determine your interest rate.

If you want to speak with one of our discharged bankrupt specialists, then you can call us on our 1300 889 743 or enquire online.

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

Ajjary
Posts: 9
Joined: Tue May 29, 2018 2:40 pm

Re: Can a discharged bankrupt get a home loan?

Postby Ajjary » Wed Jun 13, 2018 5:32 pm

Oh, that means I need to increase my deposit. Does it need to be my savings or can somebody give me the remaining portion? I want to borrow only 80% if I can get a cheaper loan.

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Otto Dargan
Mortgage Specialist
Posts: 7021
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: Can a discharged bankrupt get a home loan?

Postby Otto Dargan » Wed Jun 13, 2018 8:42 pm

Hi Ajjary,

Yes, you can arrange the remaining portion if you can and it doesn’t have to be your savings as you do have almost 9% of the property value.

You can receive deposit as gift, usually from your parents - they can gift you the money for the deposit to buy a property.

Your parents can gift you the money they have in their savings account, through the sale of assets, such as a car, or an inheritance.

The banks usually require parents to evidence that the money is a gift and not a loan that needs to be repaid. A gift letter that is signed by your parents will suffice as proof of this with most lenders.

Still, we can’t guarantee that we can get you normal bank interest rates. Every application is assessed on its merits.

Please enquire online or call us on 1300 889 743 and check if you are eligible for discounted rates or not.

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

Ajjary
Posts: 9
Joined: Tue May 29, 2018 2:40 pm

Re: Can a discharged bankrupt get a home loan?

Postby Ajjary » Wed Jun 13, 2018 10:28 pm

Oh wow, so I can ask my parents to gift me a deposit. I'll discuss this with them first and contact you guys afterwards.


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