No deposit home loans
Do you qualify?
Not enough money for a deposit on your home? Despite tougher lending terms in Australia today, there are still several paths to securing a no deposit home loan. The most usual of these is a guarantor loan, but your friendly ITP Home Loans consultant can talk you through all your options.
Guarantor home loans
Guarantor loans occur when somebody else, most commonly your parents, goes guarantor for your loan, using their own property as security. These have become very popular in recent years, because:
- The guarantee is a limited one. Your parents aren’t liable for the full amount owed, only a pre-agreed amount. They’re also not responsible for your regular loan repayments
- You can borrow up to 105% of your purchase price
- A guarantor loan will cost you less than a standard home loan
- You only need as little as $3,000 of your own money as a deposit
- You don’t need to take out Lender’s Mortgage Insurance
- Once you’ve repaid a portion of your home loan, or your property has gone up in value, the guarantee can usually be removed
No deposit home loans – lending criteria
These days, to get a zero deposit home loan you have to meet strict credit guidelines, including:
- A faultless credit and rental repayment history
- You must live in a capital city or regional centre
- Your intended property needs to be a fairly standard one e.g. a unit, house or townhouse
- You need to be in stable, ongoing employment
- You must have a good income in order to be able to easily meet your repayments
These repayments will include your Lenders Mortgage Insurance, which is usually mandatory for a no deposit, or low deposit home loan. And for this type of loan the interest rate will almost certainly be higher than for a standard variable or fixed loan.
Zero deposit loans for property investors
The other main candidates for no deposit loans are buyers of investment property wanting to make the most of tax benefits through negative gearing.
The conditions attached to getting a no deposit home loan can be quite complex, so it’s best to talk it through with a friendly ITP Home Loans consultant. Contact a professional ITP Home Loans broker today for no obligation advice and the most suitable deal on your loan – at no cost to you of course. You can email us, or make an appointment to see an advisor face to face. Alternatively, give our helpful ITP Home Loans consultants a call today on 1300 387 487.