How much extra do we need on top of the grant?

Any general questions you might have in regards to loans and finance.
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Otto Dargan
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Re: How much extra do we need on top of the grant?

Post by Otto Dargan »

Hello Grego. Welcome to the forums.

You can borrow up to 95% of the property if you have a strong employment history, clear credit history and evidence of genuine savings.
That means with a 5% deposit plus additional funds to complete the purchase should be enough. And yes, you can use the first home owners grant as part of the deposit.

Alternatively, there are other ways to get a no deposit first home buyer loan:
  • Guarantor loans: You can borrow up to 105% of the purchase price by using a guarantee secured on your parent’s property.
  • Gifted deposit: Your parents can provide you with 5% to 15% of the purchase price as a non-refundable gift.
  • Personal loan as a deposit: You can borrow up to 95% of the purchase price plus a personal loan if you have a high income and a clear credit history.
  • Use your superannuation: If you have over $150,000 in your super, you can set up a self-managed superannuation fund (SMSF) to buy an investment property.
Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify for a home loan.

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

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

Re: How much extra do we need on top of the grant?

Post by Otto Dargan »

Hi Grego,

As a minimum, you’ll need:
  • A deposit: 5% of the deposit and this can include the first home owners grant (FHOG) and you may need less if you capitalise the LMI.
  • Stable employment and income: You should be earning a regular income to support your mortgage repayments. Borrowers in a strong financial position can qualify for significant interest rate discounts.
Even if you’re outside of bank’s policies, there are lenders who can help:
  • No genuine savings: Most banks require that 5% of the deposit come from your own savings when borrowing 95% plus the cost of LMI. However, this is not a requirement with all of our lenders.
  • Credit history: We have lenders who can consider a few blemishes on your credit file.
  • Property location: Remote locations can be considered over metro locations. Please check our location guide.
  • A small amount of debt is acceptable: If you have less than 10% of the purchase price in such debt as personal loans and credits can be considered.
  • Credit scoring: There can be many reasons why you have a poor credit score but some lenders can still take a common sense approach.
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 much extra do we need on top of the grant?

Post by Otto Dargan »

Hi Grego,

There are several costs you may incur when buying your first home. You should discuss these costs with your mortgage broker or conveyancer before signing the contract to buy a property.
  • Mortgage stamp duty: This is a hidden state government fee that’s calculated based on the amount that you borrow. Most states either waive this for first home buyers or are phasing this fee out.
  • Purchase stamp duty: This is one of the most expensive costs associated with buying a home but some states offer stamp duty concessions for first home buyers (please try our stamp duty calculator to work out the exact figure).
  • Registration fees: Another government fee! This is a small fee of around $200 for registering the change of name on the property title and registering the new mortgage on the title.
  • Conveyancing / legal fees: You can expect to pay between $700 and $1,500 for your conveyancing costs for a standard first home purchase. Please refer to our list of recommended conveyancers if you’ve not yet chosen one.
  • Lender fees: Some lenders charge setup fees of up to $850 whilst others will waive all the setup fees for your loan.
  • LMI: This is the other major cost of buying your first home with no deposit. LMI can range from $0 for a quick start loan up to 5.1% of the loan amount. Some of our lenders allow you to capitalise or add the LMI onto the home loan.
We strive to make the first home buying process stress free and to help borrowers with low deposit get approved.

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

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

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