Buy A Property with Zero Deposit with Guarantor Home Loans

Buying a new home has to be one of the most momentous milestones in life. Here this Guarantor home loan is the only way to buy a property with zero deposit in Australia.

How much can I borrow on a Mortgage Guarantor?

First home buyers: 105% of the property value

Construction: 105% of the total land value and cost of construction.

Refinancing: 100% of the property value.

Debt consolidation and purchase: 110% of the property value.

Investors: 105% of the value of your investment property.

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What are the responsibilities of a guarantor on a loan?

The guarantor is the person who agrees to pay for other’s loan if that individual cannot afford to pay. Furthermore, the person who guarantees the loan fully understands the role of the guarantor and their obligations.

What are the benefits of Guarantor loans?

No limitation to borrowing
You can borrow a large amount if your guarantor is a homeowner. This is highly advantageous especially when you require funds to cater for expensive projects.

Fast Process
An advantage of guarantor loans is the quick approval of the process.

An absence of credit check
One of the greatest merits of guarantor loans is the absence of credit check as a requirement of obtaining it.

Available to people with poor credit history
Guarantor loans are designed to assist people with poor credit history. It is easily accessible as long as you can get a guarantor with a good credit score.

Save money by not paying an LMI premium
You will pay no Lenders Mortgage Insurance (LMI), save yourself thousands of dollars!

Main Types of Guarantees

Security guarantee: The guarantor offers their property as security for the borrower’s loan. This is generally undertaken by parents who are guaranteeing the loan of their children.

Serviceability guarantee: Under this type of guarantee, the guarantor vows to use some of their income, to finance the borrower’s loan.

Security and serviceability guarantee: The guarantor allot their property as security for the loan and also offers to use their income to support the borrower satisfy their loan repayments.

Family guarantee: This can only be given by a family member.

Who can give a family guarantee?

A family guarantee is defined by the borrower and guarantor being immediately related. The acceptable types of family relationships for a guarantor home loan are:

• Spouse (husband / wife).
• Child / parent
• Sibling

Removing the Guarantee

The guarantee is generally removed around five years after the loan is first advanced, although this can vary significantly.

By this stage, the borrower will have reduced their loan amount to 90% of the property value, lowering the risk to the lender.

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Talk to us to find out more

We have professionals in guarantor supported lending who will quickly work out for providing the best guarantee as per your situation. It may that a security guarantee better meets your needs, or maybe you are able to use your portion of your parent’s income to guarantee your loan repayments. Please call us on 1300 YFA BROKER or enquire online to discuss your situation with one of our mortgage brokers.