Get into the property market with a little help.


How does a guarantor work?

Getting a helping hand into the property market is common for many families. Securing your first home loan without having to save a huge deposit sounds appealing right?

Your guarantor will provide a guarantee for your home loan which is secured on their property. In most cases, this is your parents assisting you to buy a home.

The idea is for you to get into the property market sooner. Once you have paid off part of your loan or your property has increased in value, then you can apply to remove the guarantee.

Guarantor loans have become very popular in recent years as they cost less than standard home loans, they allow you to buy without a deposit and some lenders now allow you to limit the size of the guarantee.

What are the benefits of a guarantor loan?

Recently, no deposit home loans have been withdrawn from the market which makes guarantor loans the only way to borrow 100% or more of the purchase price.

Guarantor loans have several benefits for you as the borrower:

  • You don’t need a deposit, allowing you to buy a home now.
  • Save money by not paying an LMI premium.
  • Discounted interest rates are available from some lenders.
  • You can consolidate some minor debts, such as credit cards, when you buy your home.
  • You can limit the size of the guarantee.

Pivotal Financial Specialists can help you prepare a strategy to buy your first property, with a little help from your family.

Posted in Uncategorized on 1 Jun, 2018 | Comments Off on Get into the property market with a little help.