Browse Forums Home Finance 1 May 16, 2010 3:34 pm Wow, it's been almost a year since we had this popular poll and so much has changed in lending, it makes sense to run a new poll to see how things have changed from your perspective. Notes from the earlier poll; With the current wave of LVR (Loan to Value Ratio) restrictions hitting home loan borrowers in 2009, Aussie home buyers and builders are now having to save more deposit over 3 consecutive months, ask parents for financial contribution and/or ask for their Guarantee, or try their luck with a No Deposit home loan. Guarantees are either in the common form of Equity (letting you use part of their equity in their home so you have no deposit) and/or Servicing (parents guaranteeing that you will repay the loan). What % was your deposit, or what LVR was your loan when you were buying or building your home before adding the Lenders Mortgage Insurance? How do you (or rather your parents) feel about guarantees? Re: How Much Deposit for Your Home Loan? v2 2May 16, 2010 5:39 pm Good to see you back thlo, I hope business has remained positive Blog: http://bluemistkids.blogspot.com "Never be afraid to try something new. Remember, amateurs built the ark, and professionals built the Titanic." Re: How Much Deposit for Your Home Loan? v2 3May 16, 2010 6:25 pm We ended up having to have no more than an 87% LVR. Due to our land value coming in 100k short we had to string together alot of funds to go ahead with the build. We did ask my mum and step dad to be guarantors as the bank suggested it and based on our past 10 years of mortgage repayments and never faulting and what we earnt, we were perfect customers. My step dad however refused to go guarantor. I explained it wasnt' because we couldn't afford the repayments, we were going to be paying no more than we are paying now, plus we won't have the rent over our heads, and are doing it comfortably and we will hopefully be able to release the guarantor once the build was completed. We needed it due to the huge shortfall in our val. They still refused. Said they knew too many people who had been done over by their children and going guarantors! So my parents aren't positive about guarantees at all. Re: How Much Deposit for Your Home Loan? v2 4May 17, 2010 12:48 am Hels Good to see you back thlo, I hope business has remained positive Thanks Hels it's good to be here. Always positive! Re: How Much Deposit for Your Home Loan? v2 6May 17, 2010 12:14 pm you're too literal elastic. everyone knows this is not a scientific survey. just enjoy Re: How Much Deposit for Your Home Loan? v2 8May 17, 2010 5:24 pm kork I think first home buyers are taking a breather after last year. that's what the stats say. Re: How Much Deposit for Your Home Loan? v2 9May 17, 2010 5:29 pm Quote: The results are distorted, you shouldnt be comparing fhb to upgraders, maybe the poll should be fhb only as that is what a majority of people here are Im not so sure about that - there are many posters who are building for the 2nd or more time or building for the first time but have previously owned an established house. Perhaps that's a topic for another poll Re: How Much Deposit for Your Home Loan? v2 10May 17, 2010 5:31 pm Helyn Quote: The results are distorted, you shouldnt be comparing fhb to upgraders, maybe the poll should be fhb only as that is what a majority of people here are Im not so sure about that - there are many posters who are building for the 2nd or more time or building for the first time but have previously owned an established house. Perhaps that's a topic for another poll That's right! We have Helyn as a seasoned home owner and she is here Re: How Much Deposit for Your Home Loan? v2 13May 18, 2010 11:35 am Rizzo Does that make me seasoned I think you qualify Rizzo Re: How Much Deposit for Your Home Loan? v2 14May 20, 2010 6:28 pm Rizzo We ended up having to have no more than an 87% LVR. Due to our land value coming in 100k short we had to string together alot of funds to go ahead with the build. We did ask my mum and step dad to be guarantors as the bank suggested it and based on our past 10 years of mortgage repayments and never faulting and what we earnt, we were perfect customers. My step dad however refused to go guarantor. I explained it wasnt' because we couldn't afford the repayments, we were going to be paying no more than we are paying now, plus we won't have the rent over our heads, and are doing it comfortably and we will hopefully be able to release the guarantor once the build was completed. We needed it due to the huge shortfall in our val. They still refused. Said they knew too many people who had been done over by their children and going guarantors! So my parents aren't positive about guarantees at all. Bummer Rizzo.... But I have to say that I would never go guarantor for my kids either. In all the years I worked in banking, I saw some UGLY situations. I'd help them out in other ways; let them move in with us while saving, give them a gift of whatever we could afford, but never, never, never sign a guarantee. What did Polonius tell Hamlet - Neither a borrower nor a lender be? He should have added "or a guarantor". Re: How Much Deposit for Your Home Loan? v2 15May 22, 2010 8:05 pm Ok-building for the 4th time-does that mean we are well done? And I'm with kek (also having had a banking background with DH still there) Deemaree Kyndylan Capers: viewtopic.php?f=36&t=46852 My blog: http://www.sufficientlysufficient.blogspot.com/ Re: How Much Deposit for Your Home Loan? v2 16May 22, 2010 10:36 pm Yeh, I could understand why they said no, but at the same time, it was only for a few months while we were trying to sell an investment property, then the guarantee would have been taken off. I would never have expected it if it was a case of us not having saved and proven we could pay for it. We had saved a hell of a lot of money in 12 months as well as paying a huge chunk off our land, plus we had been paying the repayment of the full build for 12 months, plus rent, to make sure it was comfortable for us before going ahead. Those hairy situations that my parents were talking about came from going guarantor for children who had no way of really being able to pay the mortgage in the first place. We had the situation due to the valuation coming in so low, of either having to sell the block and lose the 100k, or try and find the extra money elsewhere and build and have a house worth what it should be at the end. My sister was willing to go guarantor for us, but our bank would only accept parental guarantors, and i didn't want to have to re-finance at the time to find someone who did. She offered to lend us the money as she knew we were good for it, but i didn't want that hanging over my head. We ended up with just enough with what we had saved for all the after handover stuff, but it means we are now relying on the sale of our investment property to be able to finish the house, whereas before it wasn't a need. Re: How Much Deposit for Your Home Loan? v2 17May 22, 2010 11:23 pm Rizzo We ended up having to have no more than an 87% LVR. Due to our land value coming in 100k short we had to string together alot of funds to go ahead with the build. We did ask my mum and step dad to be guarantors as the bank suggested it and based on our past 10 years of mortgage repayments and never faulting and what we earnt, we were perfect customers. My step dad however refused to go guarantor. I explained it wasnt' because we couldn't afford the repayments, we were going to be paying no more than we are paying now, plus we won't have the rent over our heads, and are doing it comfortably and we will hopefully be able to release the guarantor once the build was completed. We needed it due to the huge shortfall in our val. They still refused. Said they knew too many people who had been done over by their children and going guarantors! So my parents aren't positive about guarantees at all. When bank does the valuation on land, do you know what sort of things they look into? land size, location, easement? How did you end up with 100k short? this sort of things give me a goosebump to think about it. No body knows until the bank does its valuation. Re: How Much Deposit for Your Home Loan? v2 18May 23, 2010 9:06 am Tempura, our valuer didn't look at any of that. The bank read the report to me as they were stunned at how low the valuation came in too. We were being pretty conservative with our estimate too. The valuer we had just looked at what 3 other houses in the area had sold for and took the average amount. The problem was, and this house has stuffed up our next door neighbours too, that the lowest price house actually sold $150k less than what it was on the market for as they were desperate to sell. If it had of sold for what it was asking, then we would have had a much much better outcome. I did dispute it as there was a block directly across the road from us, with the same size land that sold for $160k more than what they were valuing our land at. The only difference between the two blocks was that the one across the road had golf course view that are not worth an extra $160k. The valuer hadn't even looked at the 2 blocks in our street that had sold recently and compared to them, only compared to houses that had sold and the houses were not comparable to ours in any way. I would just make sure you have some sort of buffer. We were lucky we had waited and saved for the extras and we could use that, BUT on the other hand, if we had of built 12 months earlier like we were going to, even though prices were at the lowest, the bank wouldn't have done another valuation on the land, and we would have been right. Tried to do the right thing, and we got screwed anyway. It is good in a way though, as we have ended up with a smaller mortgage, which is always a good thing Re: How Much Deposit for Your Home Loan? v2 19May 23, 2010 11:09 am just for clarification, are these valuations done before or after unconditional approval. I ask that because in our mortgage docs( which we have already signed) and returned to the bank, the offer letter states that....additionally we must be satisfied with the valuation of the security property. our is a loan for both land and house for construction. VICTORY 1800, EN-SUITE, DOUBLE GARAGE, FAMILY ROOM AND ALFRESCO Land Settled: 20 July 2010 Site Scrap: 30 August 2010 Slab Pour: 20 September 2010 Frame Complete: 23 September 2010 Fascia and Gutters: 28 September 2010 Roof Complete: 06 October 2010 Lock-up complete: 28 October 2010 Plaster complete: 29 October 2010 Fix-out complete: 22 Nov 2010 PCI 7 FEBRUARY 2011 The biggest challenge will be if you take out a loan and then run out of money - you'll have an incomplete security and lenders do not like this so you can get stuck.… 2 19068 Hi, you've probably already resolved this, however, Commbank will probably pay the funds to you after you send evidence the work is done regardless the change in the quotes. 1 35305 In NSW the maximum deposit for building work is 5% until the builder provides HBCF insurance 1 4815 |