01 Jul 2022

How can I buy a house with no deposit in Australia?

Home Loan for First Home Buyers

Buying a house with no deposit in Australia is not impossible, but it is harder compared to having a deposit. Thankfully though, there are options for Australian homebuyers looking in this hot and expensive market. All cash buyers have the upperhand. Instead of saving for a deposit on a home, why not pay for a home or land in cash?

Not all of us have enough cash to pay for a $750,000 home. Instead, borrowers can look into 105% guarantor loans. Not all home loan lenders or banks, though, offer this type of loan because there is more risk for both parties. The more people involved in a loan, the more mess there is to sort.

A guarantor is a  legal adult that puts up a property as a guarantee that the loan will be paid in full. However, in these cases, the property that is used as a guarantee or equity needs to equal 105% or more of the home loan.

Even with a guarantor, a home lender or banking institute can still add extra fees and a higher interest rate than average to the home loan. With trust and time though, borrowers can apply for other loans to refinance their high home loan.

No Deposit Homes in Australia Conclusion

It is not impossible to buy a home without a deposit in Australia, but it is hard! There are a lot of factors to consider when purchasing a home without a deposit. Banks and lending companies receive higher risk by giving money to homebuyers without savings or a deposit. Mortgage House experts can assist with no deposit homes and unique situations.

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