Home Loan Deposit - What You Need To Know
If you are getting set to buy your first home, chances are there is one question you would love to have answered: how much deposit do I need for a home loan?
Knowing how much deposit you need to raise is like having a target to aim for - it can give your home loan dream a solid grounding in reality.
Minimum deposits vary depending on the lender, but the most you will likely be able to borrow is 95 per cent of the property’s value.
That means at the very least you will need to provide a five per cent deposit and a proportion of this will need to come from genuine savings.
You can also use several other sources to supplement your own efforts, including the first home owner grant, monetary gifts, inheritances, tax refunds or the sales of other assets.
You will also probably be required to take out lender’s mortgage insurance with smaller deposits, so it is important to factor this into your saving.
To know what kind of properties you will be able to afford, find out your borrowing power by consulting a home loan expert.
To get more detailed information on your situation, talk to a Loan Market mortgage broker today.