For those trying to break into the property market for the first time and pay as little as humanly possible in up front deposits and fees, then it’s only natural that you’re going to explore all of your options.
As a general rule, Lenders Mortgage Insurance is a compulsory fee for all mortgage applicants if they don’t have a 20% deposit saved up to buy a house, and is calculated on a sliding scale. Given that the median house price for Brisbane is now roughly $850,000, without the option of Lenders Mortgage Insurance, buyers would be expected to save an eye watering $170,000 to purchase property as a means to avoid paying LMI.
This figure is simply unobtainable for many, especially first home owners looking to get their foot on the property ladder. Spending a decade or more saving up the funds can risk the buyer being priced out of the market, especially while they’re still forced to pay rent. In contrast, being slugged with extra fees linked to Lenders Mortgage Insurance isn’t all that appealing either.
Thankfully, exploring options linked to small or no deposit home loans provides an alternative. While having a larger loan amount may incur higher interest fees thanks to the size of the mortgage, it’s often the preferred choice when compared to being stuck in the rental pool – so what are a handful of the most popular options?