Family Equity Loans
Family equity, family pledge or, more commonly, a limited guarantor loan, allows a family member usually your parents to guarantee a portion of your home loan.
As a first home buyer saving for a deposit can be difficult. Using the equity in a family members existing property can help you buy a home or invest in residential property sooner and they don’t need to actually provide you with any cash.
With the limited liability guarantor structure your family member offers their property as security for part of your home loan, usually around 20%.
This will have the benefit of helping you to avoid additional costs such as Lenders Mortgage Insurance (LMI).
You may be able to buy your home sooner and maximise the amount you can borrow.
Guarantors can be parents, parents-in-law or step parents and guarantors can determine what portion of the loan they will secure.
Family equity is generally a feature and not an actual type of home loan.
You can usually add the feature to any regular home loans and take it away as well, when you don’t need it anymore.
Contact me today to find out the options you have available!