How does a gifted deposit work?

Any general questions you might have in regards to loans and finance.
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Otto Dargan
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Re: How does a gifted deposit work?

Post by Otto Dargan »

Hello Don. Welcome to the forums.

Most banks today will only consider home loan applications if you have at least 5-10% in genuine savings. One of the more popular ways to avoid the genuine savings requirement is a gifted deposit from your parents.
With a gifted deposit, you can borrow up to 95% of the property value with some lenders.

Banks usually require parents to evidence that the money is a gift and not a loan. A signed gift letter will suffice as proof with most lenders.

Speak with one of our experienced mortgage brokers by calling us on 1300 889 743 or fill in our free assessment form to find out if you qualify for a gifted deposit home loan.

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

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Otto Dargan
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Posts: 7730
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
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Re: How does a gifted deposit work?

Post by Otto Dargan »

Hi Don,

Yes, paid rent can be used as evidence of genuine savings. However, you’ll still need a deposit. Paid rent serves as proof of your capacity as a borrower to make repayments on time and in full.

In order to qualify for rent as genuine savings mortgage, you need to show a rental ledger from a licenced real estate agent showing that shows you’ve been making your rental payments fully and on time for at least 12, 6 or even 3 months.

You can find a rental ledger or a rental reference letter template here, which you can provide to your property manager to complete.

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

User avatar
Otto Dargan
Mortgage Specialist
Posts: 7730
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: How does a gifted deposit work?

Post by Otto Dargan »

Hi Don,

For any home loan with a Loan to Value Ratio above 80%, you’ll usually be paying the Lenders Mortgage Insurance (LMI).

You can use our LMI calculator to find the cheapest LMI from our panel of lenders.

A great way for you to avoid LMI altogether is by using your parents as guarantors. With a guarantor home loan, you can borrow up to 100-110% of the property value with no LMI.

Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify for a guarantor home loan.

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

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