How do I qualify for 95% home loans?

Any general questions you might have in regards to loans and finance.
Noah
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Joined: Fri Jan 18, 2019 12:44 pm

How do I qualify for 95% home loans?

Postby Noah » Fri Jan 18, 2019 12:47 pm

Hi, we are a couple looking to finance our first home and have looked at a few properties near Hobart. We’ve saved around $40,000 that we want to use as a deposit. Our savings are just enough to cover 5% of the market value of the property and any additional costs like stamp duty, government fees etc. How do I qualify for a 95% home loan?

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Otto Dargan
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Re: How do I qualify for 95% home loans?

Postby Otto Dargan » Fri Jan 18, 2019 1:16 pm

Hello Noah. Welcome to the forums.

To qualify for a 95% home loan, as a minimum you’ll need:
  • A deposit: 5% deposit including the first home owners grant (FHOG).
  • Funds to cover the costs of completion: This amounts to around another 3-5% of the property to cover stamp duty, conveyancing fees, transferring the property title, other government and legal fees, and Lenders Mortgage Insurance (LMI).
  • A steady income: You should be able to show regular income to support your mortgage repayments.

Interest rate discounts: Borrowers in a strong financial position can qualify for significant interest rate discounts.

Not all lenders offer 95% home loans.

Lenders consider all loans over 80% of the property value to be a high risk, so often they will insure these loans with LMI. They are a higher risk because if you were to default on your mortgage, there’s a higher chance that the property value will not have risen enough and they may be at a loss if they were to approve your loan in the first instance.

Call us on 1300 889 743 or complete our free assessment form to find out if you qualify for a 95% home loan.

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

Noah
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Joined: Fri Jan 18, 2019 12:44 pm

Re: How do I qualify for 95% home loans?

Postby Noah » Fri Jan 18, 2019 4:06 pm

That’s great. How much LMI do I have to pay if the property I’m looking at is currently valued at $700,000?

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Otto Dargan
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Re: How do I qualify for 95% home loans?

Postby Otto Dargan » Fri Jan 18, 2019 5:29 pm

Hi Noah,

There can be huge differences in LMI premiums depending on the loan amount compared to the property value (LVR) and the lender you choose.

Please use our LMI calculator to find the cheapest LMI premium from our panel of lenders and speak to one of our mortgage brokers directly to find out if you qualify.

Call us on 1300 889 743 or fill our free assessment form so one of our mortgage brokers can assist you.

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

Noah
Posts: 3
Joined: Fri Jan 18, 2019 12:44 pm

Re: How do I qualify for 95% home loans?

Postby Noah » Fri Jan 18, 2019 5:57 pm

One last question, how much is the first home owners grant (FHOG) actually worth?

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Otto Dargan
Mortgage Specialist
Posts: 7585
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
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Re: How do I qualify for 95% home loans?

Postby Otto Dargan » Fri Jan 18, 2019 7:09 pm

Hi Noah,

The first home owners grant amount vary between states as some state governments offer additional grants or have stamp duty concessions for first home buyers.

You can check out our FHOG calculator, which will also help you work out your stamp duty and any concessions you're eligible for.

Please refer to your state's revenue office website to confirm full criteria and grant conditions.

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


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