If you’re considering a no-deposit home loan, it’s important to do your homework so you understand the benefits and drawback. It may assist to evaluate a few of the other options available in the market. This way, you’ll be able to make a firm decision based on your situation. There is also no harm to seek the help of a broker who knows all kinds of mortgages and various options available in the market.
Sydney brokers provide first home buyer loans to various customers in Australia. The team goes ahead and navigates a bunch of mortgages and relevant interest rates to find the best lender for the buyers. Khash Jalili is a mortgage and finance broker that has helped various customers in Australia to get their home dream. The whole Sydney broker team goes ahead provides exceptional service based on their client needs and budget.
Criteria for No Deposit Home Loan
- Borrowers should have a high credit score with one of the important credit reporting organisations (Equifax, Ilion, or Experian).
- Borrowers must also show evidence that they have been paying all of their current bills on time, such as rent, credit cards, personal loans, and utility bills, etc. to qualify.
- No-deposit borrowers should have a steady job with an income that can help them repay their loan smoothly.
Options to get No-Deposit Loan
- Guarantor – One way to get into the real estate market is to ask a family member or friend, who can co-sign your loan as a home equity loan guarantor. If borrowers can get parental guarantors, certain lenders may allow them to borrow up to 100% of the property’s value.
- FHOG – First-time homebuyers seeking financial help may be eligible for a First Home Owners Grant if they meet certain requirements and decide to live in the property as their home for a specific term.
- First Home Equity Loan Deposit – This concept is designed to help some qualifying first-time homebuyers secure a loan with as little as a 5% deposit and no requirement for LMI. The government acts as a guarantor, securing the balance of the deposit to bring the house buyer up to 20%.
- Family Home Guarantee – This is a government program that is for qualifying single parents with dependents, to buy or build a home with just a 2% payment. Unlike other homebuyer programs, the Family Home Guarantee is not limited to first-time buyers.
- Monetary gift – If you get an inheritance or the lottery, you can put them towards a house deposit. Some financial institutions will take these types of funds. However, disposal amount and process may differ.
- Equity in a Property – it is known as the discrepancy between how much your property is currently worth and how much you still owe on the house loan for that property. ‘Positive equity’ refers to the difference between the current worth of your home and the amount you still owe on your mortgage.
When property prices are rising in some parts of Australia, it is becoming even more difficult to buy a first home. However, the fact is that a buyer will be able to purchase property even without a deposit, but you may have to approach it slightly differently to achieve it.