How Can I Get a 100% Home Loan?
Potential borrowers and first-time homebuyers may be interested to learn about how they can get a 100% home loan, also commonly referred to as a no-deposit loan. Unfortunately, most Australian banks, lenders, and mortgage brokers no longer allow potential borrowers to apply for a no-deposit loan without having a guarantor. 100% home loans are offered by Mortgage House by way of a 2nd mortgage, allowing a potential borrower to receive a loan in the full property value amount without needing a deposit.
A guarantor is an Australian property owner that agrees to use their home or property equity as a security guarantee for the 100% loan. However, a guarantor also accepts full responsibility for repaying the loan entirely if the borrower cannot. In addition, if the guarantor does not put up enough equity to equal a 20% deposit, the borrower will have to pay for Lenders Mortgage Insurance. This insurance type protects the lender in case a borrower is unable to meet the required mortgage repayments resulting in foreclosure.
A potential borrower interested in applying for a 100% home loan can take additional steps for a higher chance of approval:
- Raising credit scores
- Clean repayment history
- Have a stable source of income
Not sure how to start improving your credit score? Paying off any credit card debt, lowering credit card limits, closing unnecessary credit accounts, limiting loan applications, and paying bills in full and on time are just a few ways to raise your credit score.
Call and speak with a Mortgage House lending specialist today for assistance with 100% home loans, financial planning, and mortgage repayment schedules.