smartmoneysolutions.com.au
First home buyer, but no genuine savings. How do you get a loan?
"Can you buy a house without any savings?" There isn't a straightforward 'yes or no' answer to this question. In short if you think you can buy a house without spending a penny, that is not possible. Then, the answer to my question will be - yes, you do need savings to buy a house. So, the logical next question would be - 'how much money do you need to buy a house'? The maximum that you can borrow from any lender is 95% of the property price. Some of them let you add all or part of the lender's mortgage insurance (LMI) on to the loan and some of them lend a max of 95% inclusive of LMI. In short, banks want to see that you have saved at least 5% of the house price. And, they want to see that you have saved this money from your income. Often, you hear the term "genuine savings". What is genuine savings? Genuine Savings is defined as a demonstrable savings pattern established over a minimum period of 3 months in the name of at least one borrower prior to the loan application being