Guarantor investment home loan no deposit
Guarantor Investment Home Loans: No Deposit
Are you looking for a guarantor investment home loan, with no deposit? If you want to buy property without having a deposit, and while bypassing the need for mortgage insurance, this could be the right loan for you. To qualify, you will need to have a family member who can guarantee your loan with either cash, or equity in their own property. Once you have built up equity of your own in your new property, your guarantor can then be released from the home loan.
How to apply for a guarantor investment home loan, with no deposit
If you want to apply for this type of loan, you need to first make sure that you meet the basic lending criteria.
- Eligible guarantor. You need an eligible guarantor.
- Clean credit history. You should have a clean credit history with no defaults. Should you have any defaults, these defaults need to be paid off in full before you apply.
- Positive asset position. A positive asset position means that your total assets are greater than your total liabilities.
- Repayments. Can you make the minimum repayments for your loan? You need to demonstrate that you can in fact make these repayments to be considered for this loan.
- Property type. This type of loan is usually only available for residential property purchases, and not commercial purchases.
Who can act as your guarantor?
Your guarantor will typically need to satisfy the following requirements if you are applying for a guarantor investment home loan with no deposit.
- Immediate family member. Friends or extended family members such as cousins are not usually eligible to act as your guarantor for a guarantor investment home loan with no deposit. You need to have an immediate family member such as a parent or sibling guarantee your loan.
- Credit history. They will need to have a clean credit history with no defaults. If they have defaults, these will need to be paid off in full for the lender to consider your application.
- Funds. Your guarantor needs to have cash to secure your loan, or own property in Australia that can be leveraged. Additionally, they generally need to have sufficient equity built up in the property to cover at least 20% of your property purchase price.
Borrowing to cover associated costs
One of the questions that borrowers typically ask is whether they can borrow to cover some of the associated costs. The good news is that in some cases you can borrow as much as 105% to cover associated property purchase costs, such as stamp duty and conveyancing fees.
Why opt for this loan?
One of the key advantages of this arrangement is the fact that you will not need to pay for lenders mortgage insurance. As you have a guarantor, the risk profile of your loan is relatively lower as far as the lender is concerned, so you are exempt from having to pay the addition costs associated with lenders mortgage insurance.
How to apply for this loan
Getting start with applying for a guarantor investment home loan with no deposit is easy. Call ABC Mortgages today for a free phone consultation. We will take you through the entire process, and assess your eligibility for this type of loan. We will let you know whether you can borrow to cover the associated costs, and whether your guarantor is eligible to secure your loan.