• February

    3

    2019
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Getting a home loan when your deposit is less than 20%?

Getting a home loan when your deposit is less than 20%?

Saving up a 20% deposit to buy a home can be difficult for some people. Luckily there are options out there for home buyers if their deposit is less than 20%. However, lenders don’t tend to advertise the requirements for small deposits. This leaves people in a situation where they apply for a home loan, and are declined, because their deposit doesn’t meet the criteria.

Lender rules that apply if your deposit is less than 20%

All home loans have rules and criteria that you have to meet, in order for a lender to approve you. Extra rules apply to deposits, especially when these deposits are small.

When a deposit is less than 20%, a lender is likely to have requirements about where this money came from, how you’ve held it, and how long you’ve held it. Some lenders also want to see that you’ve kept on saving, even when you’ve finished saving your deposit.

Genuine savings

If you have a deposit that’s under 20%, lenders will often require that you have “genuine savings”. What does this mortgage broker Sutherland Shire home loan broker Bee Finance Savvy finance broker deposit is less than 20%mean? Well, that’s where it gets tricky. The meaning of genuine savings varies from lender to lender. And they often don’t advertise their definition, and how it applies to their home loan products.

For example, a lender may be offering a great rate, for applicants whose deposit is less than 20%. But what may not be immediately obvious, is that they may not accept deposits that are gifts from your family, proceeds from selling assets such as a car, or a bonus that you’ve earned at work.

Even if your deposit has come from the right source, they may have rules about how often you’ve added to the deposit, and how much you’ve added each time.

And with some lenders, it can get even more complicated!

Bee Finance Savvy – getting your deposit right before you apply

Failing to meet just one of a lenders’ rules about deposits can see your home loan application declined. With a mark on your credit file, it can be harder to apply again with a different lender.

So it’s important to make sure you apply to the right lender, and that your deposit ticks all the boxes, before you

For an obligation free consult, get in touch with our savvy broker Desiree!

apply. That’s where Bee Finance Savvy comes in. We know our 30+ lenders rules inside and out. Even though these rules are changing all the time, we stay up to date with them.

This lets us work out which lender best suits each one of our clients, including whether their deposit meets that lender’s criteria.

Our upfront assessments are 100% obligation free, so why not get in touch today. Our friendly broker Desiree is here to answer all your questions, and help you on the way to reaching your goals.

To find out more, call or text Desiree on 0455 131 937 or 1300 140 554. Desiree can also be reached at enquiries@beefinancesavvy.com.au .  You can also fill out the contact us form on this site.

If you’d like to hear from just some of our satisfied customers, take a look at our reviews on WOMO https://www.wordofmouth.com.au/reviews/bee-finance-savvy-miranda

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