Tips to help you enter the property market sooner
However, there are several options to help you enter the property market with a smaller deposit.
Government grants
The Queensland Government provides the First Home Owners’ grant to help Queenslanders enter the property market. The $15,000 grant is available to first home buyers who purchase a new or substantially renovated house, unit or townhouse valued at less than $750,000. Your lender can help you to determine eligibility and apply for the grant.Consider a longer loan term
While most home loans are 20-30 years, a small number of lenders offer loan terms of up to 40 years. Longer loan terms can be beneficial for buyers who are looking for the flexibility of smaller monthly repayments. This can make the loan repayments more manageable for first home buyers, however, speak to your lender to ensure you are aware of your options. Consider how your loan will meet your needs now and into the future.Get a guarantor
If you have a small deposit or limited equity available to purchase your home, a guarantor can provide the additional security needed to secure the loan. This is generally an immediate family member that has equity available in their own home. It is important to remember that, should the borrower default on their loan repayments, the guarantor’s security could be at risk. Talk to your lender about the benefits and risks of using a guarantor.Lenders Mortgage Insurance
If you meet your lenders requirements but don’t have a substantial deposit (usually 20%), Lenders Mortgage Insurance (LMI) can make it easier for you to secure a loan. LMI is a one-off cost paid by the borrower which protects the bank against any loss incurred if you’re unable to meet your loan repayments. While there are costs associated with LMI, it can be added to your loan amount and can help you to enter the property market sooner to start growing equity in your home. RACQ Bank’s Buying and Selling Calculator can help you to determine LMI costs.
Banking and loan products are issued by Members Banking Group Limited ABN 83 087 651 054 AFSL and Australian credit licence 241195 trading as RACQ Bank. The information in this article has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained in the document is general advice and does not take into account any person's particular investment objectives, financial situation or needs. Before acting on anything based on this advice you should consider its appropriateness to you, having regard to your objectives, financial situations and needs.
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The information in this article has been prepared for general information purposes only and is not intended as legal advice or specific advice to any particular person. Any advice contained in the document is general advice, not intended as legal advice or professional advice and does not take into account any person’s particular circumstances. Before acting on anything based on this advice you should consider its appropriateness to you, having regard to your objectives and needs.
Insurance products (excluding Travel Insurance) are issued by RACQ Insurance Limited ABN 50 009 704 152 (RACQ). Conditions, limits and exclusions apply. This is general advice only and may not be right for you. This information does not take your personal objectives, circumstances or needs into account. Read the Product Disclosure Statement (PDS) and any applicable Supplementary PDS before making a purchase decision on this product. You can also access our Target Market Determinations on this website.
Banking and loan products issued by Members Banking Group Limited ABN 83 087 651 054 AFSL/Australian credit licence 241195 trading as RACQ Bank. Terms, conditions, fees, charges and lending policies apply. This is general advice only and may not be right for you. This information does not take your personal objectives, circumstances or needs into account. Read the disclosure documents for your selected product or service, including the Financial Services Guide and the Terms and Conditions, and consider if appropriate for you before deciding.
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RACQ Operations Pty Ltd (ABN 80 009 663 414 AR 000234978) and Members Travel Group Pty Ltd (ABN 45 144 538 803 AR 000432492) are acting as an Authorised Representative of the issuer of the insurance, Tokio Marine & Nichido Fire Insurance Co., Ltd. (ABN 80 000 438 291 AFSL 246 548). Any advice set out above is general in nature only, and does not take into account your objectives, financial situation or needs. Before purchasing any travel products, please consider the RACQ Travel Insurance Product Disclosure Statement (PDS) and the Target Market Determinations (TMDs) that apply to these products. Whilst the PDS outlines the Terms and Conditions of these products, the TMDs outline the intended class of customers that comprise the target market for these travel products. This will allow you to consider which products best suit your objectives, financial situation and needs and consider the products appropriateness to your personal circumstances. TMDs also outline matters involving the distribution and the review of these products. The PDS, Supplementary PDS and TMDs for each travel product can be found here.