With house prices shooting up and down, anyone who hasn’t gotten their hands in the market for homes is in for a rough ride. For those who do not have the wealth built up to invest in properties, all might seem lost. However, there is one thing that we can do, and that is to rely on a family guarantee home loan. By getting one of your relatives to pledge their equity, you can land the dream house of yours.
Here are the three main advantages of using a family guarantee home loan to enter the property market as a first home buyer:
As you might know, when taking out a loan, most lenders will require you to deposit at least 20 per cent of the total loan for the request to be approved. However, there are still some other loans that allow a deposit lower than the 20 per cent mark. Those are only available if you are eligible for Lenders Mortgage Insurance or LMI for short. This type of insurance covers the lender in the case that you cannot meet your payments. However, taking out money for LMI can be quite costly, and should be avoided, especially if your income isn’t high.
With family guarantee loans, if you couldn’t hit the 20 per cent deposit mark before, now you can. In other words, you can borrow as much as you need to cover the rest of the deposit you couldn’t in the beginning, allowing you to secure the entire cost of the deposit. You can even borrow out the money to pay for the house entirely + additional costs such as stamp duty, legal fees and even extra money for renovations!
Of course, this doesn’t mean that you’re free from monthly payments. You’ll still have to pay back the lender, you’re essentially using the sufficient equity in your guarantor’s property and providing this as security to the bank with your new purchase! Better yet, as soon as your new loan is sitting at or below 80% loan to value ratio, your guarantor’s property can be released from your loan!
Because you are now able to purchase a home, you can enjoy first home buyer benefits like others who have bought a home before you. Benefits, such as a first home buyer grant and the stamp duty concessions are rewarded to you, and all of these can pile up to thousands of dollars in value.
If you end up borrowing money that totals over 80 per cent of the value of your property, an LMI is generally required to be taken out. This is to guarantee the lender that in the event you cannot pay back the amount you’ve borrowed, the lender is cushioned from the blow.
But of course, getting an LMI is extremely expensive. A family guarantee loan can cover that 20 per cent, meaning that you’ll have to borrow only 80 per cent of the money to cover the rest of the cost and not more. As a result, you buy yourself home without having to take out the costly LMI.
The property market isn’t the most straightforward thing to understand. Because of that, there is plenty of planning, strategizing, and understanding of the risks you’re about to face to be done. Only that way, and with proper discussions with all the relevant parties such as your guarantors, you can ensure that the purchase of your home is smooth sailing.
Engage the services of a mortgage broker to aid you through this process from start to finish. We’ll take a look at your financial position and put a plan in place to ensure your home loan gets approved in the most beneficial way for yourself.
Contact us on 02 8530 1107 or Submit your scenario online
Whether you’re a first home buyer looking at entering the market or an existing home owner looking at ways to save money on your home loan, we have you covered. We’ve put hundreds of hours of research into these guides to ensure you end up ahead, and it’s completely on the house.
We meet for a consultation, obtain your supporting documents and proceed to structure and package your application for approval knowing exactly what the banks want to see. We also monitor your home loan post approval ensuring you’re home loan suits you and your financial position
We get paid a commission from our lenders as a result of introducing your business to them. Subsequently, our service is at no cost to you. Our commission does not affect your interest rate whatsoever, if anything, we’re in a position to get you a lower interest rate than the general public due to our relationships with our banks
With our many years experience in the industry, we’ve been exposed to both easy and complex loan scenarios. Each loan we process gets presented to over sixty financial institutions, ensuring we have explored all options possible and are able to provide a solution
When you decide to purchase property in Australia – whether you are a foreigner or an Australian – you must be aware of the fact that there are a few aspects you should consider. After all, if purchasing property was an easy thing to do, we’d all do it and never look back.
When dealing with a home loan, you will most likely come across the Loan to Value Ratio term. Obviously, everyone who wants to apply for a home loan should consider this term and what it implies, as it affects your borrowing power.
The odds are that you’ve stumbled across the term lender’s mortgage insurance and you’re wondering what it stands for. Well, you’ve come to the right place. This article will clarify this term, so that you can understand what it is, the concept behind it and the approximate costs. Let’s get started!
As you may know, a trust structure comes with tax advantages and asset protection for investment properties and not only. However, it is known that many lenders don’t actually know how a structure trust loan works – and this may result in you, the borrower, missing out on certain tax advantages and potentially wasting your time with the wrong lender.
The odds are that you’ve stumbled across the term lender’s mortgage insurance and you’re wondering what it stands for. Well, you’ve come to the right place. This article will clarify this term, so that you can understand what it is, the concept behind it and the approximate costs. Let’s get started!
The odds are that you’ve stumbled across the term lender’s mortgage insurance and you’re wondering what it stands for. Well, you’ve come to the right place. This article will clarify this term, so that you can understand what it is, the concept behind it and the approximate costs. Let’s get started!
Trustindex verifies that the original source of the review is Google. 
Trustindex verifies that the original source of the review is Google. 
Trustindex verifies that the original source of the review is Google. 
Trustindex verifies that the original source of the review is Google. 
Trustindex verifies that the original source of the review is Google. 
Trustindex verifies that the original source of the review is Google. 
Trustindex verifies that the original source of the review is Google. 
Trustindex verifies that the original source of the review is Google. 
Trustindex verifies that the original source of the review is Google. 
Trustindex verifies that the original source of the review is Google. 
What you need to know before you purchase your first property and how to fast track it. We have designed this guide to get you up to date with everything you need to know about being a first home buyer. Whether you have a short term goal of purchasing your first property or are thinking about it sometime later down the track, this guide will cover important essential aspects of this exciting journey.
What the banks won’t tell you and how to save serious money on your home loan. By Investing 10 minutes of your time to read through our guide, not only will you learn the tips and tricks the banks won’t always tell you to assist you with paying off your home loan sooner, but also gain an insight into some techniques that will allow you to minimise the interest you pay to the bank.
The best way to take control of your finances is to use a budget planner. This is a simple tool that helps you understand the money going in and out of your household. With our Highline Lending Budget Planner, we’ve got you covered. This handy tool allows you to log and track your goals, track your savings, track your debt and expenses and keep a monthly record for an end of year evaluation.
