Avoid paying lender’s mortgage insurance (LMI) with the backing of a guarantor home loan
Saving the deposit is the hardest step to securing any home loan. Guarantor home loans enable families to work together to help first home buyers enter the property market without saving 20% of the property value, and without paying the cost of LMI.
The guarantor doesn’t give you or the lender any money. To be eligible, the equity of their property must be sufficient to provide the additional security required to reduce your Loan to Value Ratio (LVR) to 80%. Once the equity in your home reaches 20% you can apply to release the guarantor from their obligations.
Guarantor home loan interest rates and fees can vary greatly between lenders. It pays to have a mortgage broker experienced with the different loans and offers available who can help you negotiate the best deal for your circumstances.