Re: Buying investment property with the help of a guarantor
Posted: Sun Oct 04, 2015 9:45 am
Hi ottoman. Welcome to the forums.
If you’re planning on buying an investment property using a guarantor mortgage then you may be delighted to know that it is possible. You may already know that in a guarantor mortgage, the property of the guarantor, who is usually your parents or close relatives, is used as security against the property that you’re buying.
With a guarantor mortgage, you may be able to borrow up to 105% of the property value that you are buying to cover the cost of the house as well as other associated costs such as stamp duty and conveyancing fees. If you want to consolidating minor debts with your home loan, then you may be able to borrow even up to 110% of the property value.
However, please note that your guarantor must have sufficient equity in their property. You may also need to have at least 5% of the purchase price in genuine savings since it is a requirement from some lenders even if you’re borrowing the full amount.
If a guarantor doesn’t seem like the way to go then another way through which you may be able to buy an investment property is through a home equity loan. You mentioned that you paid off a previous home loan so it should be safe to assume that you already own a home. You may be able to use the equity in your home for a new mortgage since you’ve already paid off the mortgage meaning you should have sufficient equity on the home.
Cheers,
Otto
If you’re planning on buying an investment property using a guarantor mortgage then you may be delighted to know that it is possible. You may already know that in a guarantor mortgage, the property of the guarantor, who is usually your parents or close relatives, is used as security against the property that you’re buying.
With a guarantor mortgage, you may be able to borrow up to 105% of the property value that you are buying to cover the cost of the house as well as other associated costs such as stamp duty and conveyancing fees. If you want to consolidating minor debts with your home loan, then you may be able to borrow even up to 110% of the property value.
However, please note that your guarantor must have sufficient equity in their property. You may also need to have at least 5% of the purchase price in genuine savings since it is a requirement from some lenders even if you’re borrowing the full amount.
If a guarantor doesn’t seem like the way to go then another way through which you may be able to buy an investment property is through a home equity loan. You mentioned that you paid off a previous home loan so it should be safe to assume that you already own a home. You may be able to use the equity in your home for a new mortgage since you’ve already paid off the mortgage meaning you should have sufficient equity on the home.
Cheers,
Otto