What LVR should I expect to get?

Discussion in 'Loans & Mortgage Brokers' started by Daniel J, 12th Oct, 2019.

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  1. Daniel J

    Daniel J New Member

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    12th Oct, 2019
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    Location:
    Melbourne
    My partner and I have been looking at purchasing a townhouse in Melbourne’s inner northern/eastern suburbs in the price range of $600-750k, however we know we don’t have the deposit required right now.

    We’re mid 20’s, first home buyers, strong financial savers, recently finished university and have come out with about a $30,000 HELP debt each. Currently we’re on a combined income of around $190k.

    So my question is - Given that we are both on strong incomes with little expenses and are save around $6,500 per month, what kind of LVR could we expect? Is as low as 5% possible?
     
  2. Morgs

    Morgs Well-Known Member Business Member

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    Sydney NSW
    Hey Daniel, some lenders will do 95% LVR + capitalize LMI. As first home buyers you'll have stamp duty exemption up to $600K ($0) and a concession up to $750K so just keep that in mind.

    The other option to explore is using a parental guarantor if you've got a family member who has a property with sufficient equity in one of their properties. This could get you in quicker and avoid LMI completely.
     
  3. Daniel J

    Daniel J New Member

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    Thanks for that Morgs. I’ve always tried to avoid using parents as a guarantor as I don’t want to potentially put pressure on them. If I were to use them as a guarantor, how would I go about breaking that link once we have a large sum behind us? Would I just refinance?
     
  4. Eric Wu

    Eric Wu Mortgage Broker Business Member

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    Location:
    Australia
    Hi Daniel

    Welcome to the forum.

    When you reduce the LVR to 80%or lower (loan /bank valuation), by either reducing current loan or by market moving up, you could release them straightaway, matter of filling a form with some banks.
     
  5. Morgs

    Morgs Well-Known Member Business Member

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    Exactly, either refinancing or paying down the loan enough to release it. Each lender works slightly differently in regard to the way it works; as an example with some independent legal advice is mandatory.

    The other thing that is on the horizon that may help is this: details are still pretty thin on the ground around exactly how it'll work but they're in a consultation period now. I suspect it will be limited though and I know there are lots of FHBs waiting for this so may be a bit of a rush on the market when it does come through:
    Helping Australians Buy Their First Home
     
    Lindsay_W likes this.