Call
1300-729-177
or 02-9210-1000
- Got little deposit available?? ... Read on!
95% home loans
** Due to the global financial crisis, 100% home loans were withdrawn by all major Australian lenders in 2009. The maximum loan to value ratio was reduced to approximately 98% (ie 95% loan + 3% mortgage insurance). It is unlikely 100% home loans will return to the Australian marketplace.
Do you want to become a home owner but have little deposit available?... If so then a 95% home loan may be best for you.
Most Australian lenders will allow a loan up to 95% of the value of the property you are purchasing, and will then also lend you an additional amount to pay for mortgage insurance taking the total loan to around the 97-98% mark.
Using a 95% home Loan, the amount of deposit you will need to contribute is dependent on a number of factors including the cost of the property, whether or not you are a first home buyer, and the state or Australia that you purchase in. As a rough guide for NSW assuming a $7,000 first home owners grant and the purchase of a "new unlived-in property" ....
- a $250,000 property could be purchased with as little as $7,500 deposit
- a $500,000 property would require about a $20,000 deposit
if you are buying in state other than NSW, the amount of deposit you require (compared to the list above) is dictated by the stamp duty exemptions applicable. More information on comparative stamp duty costs is available in our First Home Buyer e-Course (see below in blue) or by clicking our stamp duty page.
Most lenders will require that a certain minimum amount of your deposit comes from your own savings (evidenced by a 3 month bank account history). Generally, the amount of "genuine savings" you require is 5% of the value of the property however rules differ between lenders and in some cases we can reduce this 5% requirement by $7,000 (if you are a first home buyer) and another $7,000 for any gifts you might receive from family. For example, a 500,000 property purchase in NSW requiring 5% ($25,000) genuine savings may still be able to be approved if the customer can show they have saved $11,000 of the deposit themselves ... with the balance coming from the $7,000 first home owners grant and a $7,000 gift from familiy.
The genuine savings rules vary greatly between lenders and also the lenders constantly change their geniune savings policy as they compete with each other so the best way to determine if your situation is suitable for an approval is to contact us and ask.
Home Loan Advice Centre's loan service is provided to you completely free of charge. We can do this because our lenders (30 of Australia's main lending institutions) pay us commissions based on the wholesale volume of loans our group refers to them. We can therefore, offer you our experience and expertise, and guide you through the entire home buying journey, without charging you a cent. You end up with exactly the same loan if you'd organised it through a bank yourself, but we do all the leg work and negotiations with the banks for you ..... a great result! So if you are looking to buy a home or investment property visit our 5 minute online enquiry form. We'll assess your loan options and send you a full report of your capacity. Also we'll include parts 1 and 2 of our eCourse ... an indepth guide to buying property in Australia. Click to see a sample. |
If you believe that this type of loan is most suitable to your situation then please contact us to find details or fill in the online enquiry form on our website.
To find out more about 95% home loans please call Home Loan Advice Centre on 02-9210-1000 or see the following links:
Application process
