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  1. #11
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    I wouldn't go anything more then a 95% loan. You will need to pay LMI on anything over 80% too.

    I'd wait and try as hard as possible to have at least 5%.

    Good luck.

  2. #12
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    I just wanted to add. We pay high rent and it was hard for us to save too.

    We actually sold our new car for one 6 years old and put the money in an interest account then started adding a little bit to it each pay. So once our loan was paid off we were able to have a deposit.

    So I do understand how hard it is.

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    austmum  (14-08-2012)

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    Subbing.. let me know how u went with the broker.. we have been looking at this too.

  5. #14
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    DF and I took out a 110% loan in 2006. We were desperate to get our foot in and we were also trying for a baby at the time. My age in particular put more pressure on us to buy a house and have a baby.

    In saying that we were extremely careful to buy a house witih lots of room for capital growth. We bought at the bottom of the market a "rennovators delight". The extra money we had left over as well as the home buyers grant went straight back into the house on rennovations (a new kitchen and lots of time spent making the place remotely livable) combined with some growth in the market meant we were only in negative equity for a short while. We had our house valued about a year ago to have it remortgaged and were able to release nearly $40k whilst staying in equity and we could plough that money right back into the house on further rennovations (a new deck and we rennovated part of our house as 1/3 of it was not livable).

    ETA: I should add that DF is super duper handy around the house and this has saved lots of money on rennos and general maintenance.
    Last edited by Busy-Bee; 14-08-2012 at 13:04.

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    Default Has anyone dealt with 1st home loans, 100% finance

    I can't stress enough how dangerous a 100% loan is in today's housing market.

    There is a VERY strong possibility that a loan of this nature will result in negative equity (owing more than the house is worth). If an unforeseen calamity was to hit your household (lost job, illness, etc) you couldn't even sell the house to clear your debts if you needed to.

    That's obviously a doomsday scenario, and I have no understanding of your personal circumstances, but please make sure you don't get yourself into something that you will regret in the long run.

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    Would you need a guarantor to even been considered for these types of loans? I want to get into the property market but find it really hard to save the deposit with 4 kids, having said that we are brilliant with bills and rent, never been late etc. I'm hoping to get 10% but if not I would possibly consider 5%...

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    Default Has anyone dealt with 1st home loans, 100% finance

    100% loans aren't always evil but you really do need to research incredibly carefully.

    Look at the interest rate they are charging you compared to loan from another lender where you have a 5%+ deposit.

    How does that impact your repayments? Immediate affordability is the obvious consideration, but also see if you can compare the position you would be in if you took the time to save a small deposit and then paid mortgage with a lesser interest rate.

    What are house prices in your area doing? Are they rising so quickly that by the time you have a deposit you will be priced out of the market? If so it might be worth the financial stretch. If not, consider waiting.

  9. #18
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    Default Has anyone dealt with 1st home loans, 100% finance

    Update for those interested...

    We met with the broker and he said the way this works is getting 2 mortgages on the one home. One for 85% from the bank.

    There was 3 house and Land packages to choose from all with colours etc already chosen. They were small only 430m2 and 3 bedroom. The estate its self has a bad reputation for being built on a swamp basically. The cost really seemed more than what it's worth. There are bigger brand new places in the the same suburb for 100,000 less.

    I would be happy to put up with a small house for a few years just to get into the property market but this was just not worth it.

    We decided not go ahead with it in the end. Disappointing but for the best. Back to budgeting and saving the 5% for us. In the mean time enjoying our huge rental house in the perfect aria lol.
    Last edited by austmum; 16-08-2012 at 13:51.

  10. #19
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    Default Has anyone dealt with 1st home loans, 100% finance

    Just adding the builder was simonds homes.

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    Default 1st home

    Meanwhile it would take us 3 years to save 15,000 for a deposit - just 3% Oof the purchase price, and in those 3 years spend an additional $51,480 on rent. So I'm all for 100% loans if they work out well.


 

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