Home loan help for buyers on lower incomes

Written by The ReReport
As seen in the Source link, written by on 2019-03-19 06:43:51

MODERN twists to mortgages are giving first home savers and low-income buyers a better chance of getting a foot in the door.

First-home buyer activity is at a near six-year high — helped by innovative products, technologies and strategies — with 26.6 per cent of all mortgages now held by people entering the market.

Low income households in several states can apply for government-backed loans or schemes with low deposits.

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Rosa Marino used one of these, a HomeStart Wyatt Loan that lends up to $10,000 for upfront costs free for five years, to buy her unit despite being a full-time carer for son Daniel, 19.

“I thought the only option would be to rent, but that was something I really didn’t want to do,” said Ms Marino, 56.

“I didn’t have a traditional full-time job, but they made me feel valued and were prepared to give me a chance.”

media_cameraRosa Marino bought her unit with help from HomeStart Finance. Picture: Supplied

HomeStart chief executive officer John Oliver said there were more borrowing options available than many people believed.

“Talking to a range of lenders or engaging a broker are great ways for potential first home buyers to get across all the options available to them,” he said.

Compare home loans for first-home buyers

“The large deposit that many lenders require, the upfront cost and the misconception that it takes two wages to buy a property are among the reasons why some people might feel that they can’t get into home ownership.”

Mr Oliver said potential buyers should check for other support, such as stamp duty concessions.

Parent guarantees, shared equity schemes where the lender takes a stake in the home, and first homebuyer grants may also help.

Home Loan Experts managing director Otto Dargan said it was harder to save a deposit than pay a mortgage because you usually had to pay rent while putting aside savings.

“First home buyers can still buy with no deposit if their parents are willing to guarantee their loan,” he said.

“This isn’t suitable for everyone, however it is by far the easiest way to stop wasting money on rent.

“There’s some fantastic tools out there that can help people to budget and save. MoneyBrilliant and Pocketbook are apps that take data from your bank account and let you know where your money is going.”


Originally published as Extra loan help for homebuyers