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Lender for someone on low wage + centrelink

Discussion in 'Property Finance' started by weejimmy, 18th Mar, 2016.

  1. weejimmy

    weejimmy Well-Known Member

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    Hi just trying to help out somone here,
    He is on a low wage at around $45kpa and has 4 kids between 8 and 12, he gets $1020 a fortnight from centrelink, has a wife but she dosent work.
    But he has managed to save a $40,000 deposit (i was impressed at that)

    Anyway, who would be the best bet for a loan for his 1st house?

    Do any lenders take centrelink as addational income?

    Thanks
     
  2. D.T.

    D.T. Adelaide Property Manager Business Member

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    Keystart / Homestart? Govt based lenders state depending.
     
  3. weejimmy

    weejimmy Well-Known Member

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    In WA.
    1. Thanks ill check those out.
     
  4. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

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    There are lenders which accept centrelink payments - but it depends on what type of payments are being received and how long they will remain.

    For example certain lenders will accept family tax benefit payments, but only if the payment will be continuing for 5+ years.
     
  5. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    Key start may be an option, especially if they have no other debt. But if they can avoid Keystart even better - their servicing is horrid and so are the rates, it's really only for those with no deposit, and with a $40k deposit there may (most likely are) better options. Are they both first home buyers?

    If they buy new or build, it will stretch that $40k even further.
     
  6. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    Also the Govvy Shared Equity scheme - google that for them :)
     
  7. legallyblonde

    legallyblonde Well-Known Member

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    Wowsers, 5 dependants will eat right into his borrowing power I would have thought.
     
  8. legallyblonde

    legallyblonde Well-Known Member

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    Also, given the ages of the children she would be the dole and they would obviously get Family Tax Benefit.

    I would assume that a job seeking payment (aka an allowance) would not be included as income in the same way a pension would be (disability payment for example).
     
  9. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    ANZ is pretty good for this type of deal esp if the kids are older, on the proviso there is job income here as well

    ta

    rolf
     
  10. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    That's why shared equity is good - the gov buys a portion of the home so they only have to service the rest.
     
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  11. weejimmy

    weejimmy Well-Known Member

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    @jess Yes both first time home buyers.
    Thanks for all the advice guys.
     
  12. weejimmy

    weejimmy Well-Known Member

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    Also how do you know what they would lend without doing a full enquiry?
    If you go on the web page they ask for very little information, is it enough to be anywhere near accurate?
    for example ANZ say they would lend $380,000 but only ask for income, expenses and how many dependents. I would guess that cant be very accurate?
     
  13. tobe

    tobe Well-Known Member

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    Not accurate. Get a professional to run. The numbers for them personally with payslips and Centrelink income statements.
     
  14. Redom

    Redom Mortgage Broker Business Member

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    Apart from Gov't finance options - get someone to run the numbers as a starting point. Yes, usually the $1020 p/f can be included with some lenders (FTB?).

    It would depend on other serviceability metrics like: rental expense p/m (if looking for investment), other debts, CC limits, etc.
     
  15. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    ANZ's online calculator doesn't actually match ANZ's own lending policies. It's a sales tool designed to get people to contact the bank and not at all accurate. The same can be said for other lenders online tools.

    Even if lenders online calculators were accurate, most people don't have the understanding of lenders policies to put the right figures into the places in the calculators.
     
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  16. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    How does the shared equity work if the property is subdivided and another dwelling constructed on it ?

    Does the equity share of the mortgage provider remain limited to the original dwelling or does it extend to the capital improvements ? If yes, does the equity / mortgage provider share the capital expenditure towards the improvement ?

    A simpler substitute for the above questions is would shared equity be available for construction in general and an owner builder in particular ?
     
  17. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    @Skilled_Migrant I don't know of any govt shared equity properties where there is a possibility of subdivision. Have you seen any?
     
  18. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    No, hence the questions.
    But it appears to be rather innovative with regard to overcoming serviceability limits. I just wanted to know how much can we push the envelope with regard to development ? Depending on the shared equity contracts various stages of development are possible:
    • Just planning approvals before reselling
    • Complete subdivision without construction
    • Subdivision with construction.
    • Multiple units etc.
     
  19. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    It's got strict criteria for low income earners and is limited to certain prechosen houses which are often tiny cottage types or apartments. Also brand new in estates so unlikely to be subdiv potential.
     
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  20. JohnPropChat

    JohnPropChat Well-Known Member

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    Most govt shared equity schemes are for PPORs only and has a upper threshold on income.
     
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