Using your property as security on your home loan | Finder

How does your property work as security for a home loan?

Your property provides your lender with collateral for your home loan

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Property security is a way for people to secure a loan. It's what the lender uses as protection in the event you can't repay the debt.

If you can't repay your debt or fall into severe financial difficulties, they can take possession of the asset you secured the loan with and sell it to recover their costs.

  • Security: Security is an item or sum of money that is used to protect the loan. The security will have to be something that, if sold, will be able to cover the cost of the loan and any money that they spend selling the item. The security can be a number of things, but will generally be in the form of property or money.
  • Property security: Property security is simply security in the form of property. The property security may be the property which the loan is used to buy, or it may be another property - it's not unheard of for a parent to use the family home to secure against a child's loan - but obviously, any agreement with a third party security must be consensual and agreed upon in writing.

The value of the security is assessed by a professional valuer. This is called a bank valuation. A bank valuation will determine the approximate price of the property and will be used to work out the loan size and subsequently, the loan to value ratio. This also gives the lender an indicative price on how much they can get for the asset if they have to sell it.

Related: Calculate your own LVR

What is a guarantor and how do they provide security?

Guarantors are generally parents or close family members who agree to assume responsibility for a home loan should the borrower be unable to repay it. Borrowers use guarantors to enable them to buy a home with little or no deposit. A guarantor often uses their own home as security for the borrower's home loan.

What types of property cannot be used as security?

The easier a property is to sell and the higher the demand for that particular type of property, the better the chances of a lender accepting it as loan security. Below you will find a few property types that lenders tend to shy away from when it comes to low doc loans.

What happens if you don't make your repayments?

According to the Australian Securities and Investment Commission (ASIC), this is what happens when a mortgage default is enforced:

A lender can sell the primary security on a loan to cover their costs if a borrower's payments fall into default and if the payment default is not corrected after the lender gives notice.

Lenders will be required to submit a letter of demand or requirement notice if payments fall into default, although it is stated that this is not mandatory. If the borrower fails to make a payment as set out in the letter of demand, the borrower must then send a default notice. This notice explains how to rectify the situation and gives the borrower 30 days to do so.

Once the lender has served the appropriate notices and provided that the borrower has not requested a hardship service, the lender has the power to obtain a court order allowing them to enter the property. From here it can be sold to recoup their costs. A borrower has the option of defending against this action. They must file a Notice of Appearance within 10 days and a Notice of Defence within 30 days after that. If this does not happen, the court will order that the lender has the power to take possession of the property, but not the goods inside.

The property can be sold at auction or by private sale.

The most important things to know about home loan defaults

What happens if the lender goes bankrupt?

If the lender goes bankrupt you'll not be liable to pay any money. However, if the lender goes bankrupt your loan and the security property may be switched to another lender. This will rarely negatively impact consumers in terms of the interest rates they pay on their loans.

When you've obtained your loan, ensure that your repayments are made on time. Remember that if you experience financial difficulties and cannot meet your loan obligations, contact your lender first to agree on a solution.

Information if you are struggling to pay your loan

Start comparing home loans

Data updated regularly
$
years
Name Product Interest Rate (p.a.) Comp. Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment
St.George Fixed Rate Advantage Package
1.84%
3.38%
$0
$395 p.a.
80%
$543.64
Up to $4,000 refinance cashback
Borrowers with 20% deposits or equity can get this competitive fixed rate loan. Refinancers borrowing $250,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
Westpac Flexi First Option Home Loan
2.29%
2.72%
$0
$8 monthly ($96 p.a.)
95%
$577.55
Up to $3,000 refinance cashback.
A flexible and competitive variable rate loan. Eligible borrowers refinancing $250,000 or more can get $2,000 cashback per property plus a bonus $1,000 for their first application. Other conditions apply.
UBank UHomeLoan Fixed
1.75%
2.22%
$0
$0 p.a.
80%
$537
This very low fixed rate is only available until 29 April 2021. Other conditions apply. A competitive fixed rate loan with no ongoing fees. Requires a 20% deposit
HSBC Fixed Rate Home Loan Package
1.88%
2.86%
$0
$390 p.a.
80%
$546.6
$3,288 refinance cashback offer
Lock in a low fixed rate for 2 years and buy your home with a 20% deposit. Eligible refinancers borrowing $250,000 or more can get a $3,288 cashback. Terms and conditions apply.
Suncorp Home Package Plus Fixed
1.89%
2.85%
$0
$0 p.a.
80%
$547.35
Lock in a low fixed rate loan for two years and get the annual package fee waived in the first year. Available for borrowers with 20% deposits.
Athena Variable Home  Loan
2.19%
2.19%
$0
$0 p.a.
60%
$569.91
Owner occupiers with 40% deposits or equity can get this competitive variable rate loan. No upfront or ongoing fees.
AMP Bank Professional Package Fixed Loan
1.99%
3.1%
$0
$0 p.a.
80%
$554.81
Get a low fixed rate package with no application or settlement fee. Available with a 20% deposit. Other fees and charges apply.
loans.com.au Smart Booster Discount Variable Home Loan
1.99%
2.47%
$0
$0 p.a.
80%
$554.81
Home buyers can get a very low discounted variable rate for the first year. This loan has a revert rate of 2.48%. Requires a 20% deposit. Add an offset account for an additional 0.10% on your interest rate.
Westpac Fixed Option Home Loan Premier Advantage Package
1.89%
3.46%
$0
$395 p.a.
95%
$547.35
Up to $3,000 refinance cashback.
Eligible borrowers refinancing $250,000 or more can get up to $3,000 cashback. Other conditions apply.
Macquarie Bank Basic Fixed Home Loan
2.09%
2.43%
$0
$0 p.a.
70%
$562.33
Get a low interest rate and a mortgage with flexible, basic features. No application or ongoing fees. Requires a 30% deposit. Refinancers can switch with a convenient digital application.
St.George Basic Home Loan
2.49%
2.51%
$0
$0 p.a.
80%
$593.01
Up to $4,000 refinance cashback
Get this low-rate variable loan with a 20% deposit and pay $0 application fee. Borrow from $150k (or $250k to be eligible for the cashback offer) (terms, conditions & exclusions apply).
Well Home Loans Balanced Fixed Home Loan
1.89%
2.18%
$250
$0 p.a.
90%
$547.35
Owner occupiers can get a sharp fixed rate for the first year, plus an offset account. Available with a 10% deposit.
UBank UHomeLoan Variable Rate
2.34%
2.34%
$0
$0 p.a.
80%
$581.39
Enjoy flexible repayments, a redraw facility and the ability to split your loan. Plus, pay no application or ongoing fees.
HSBC Home Value Loan
2.44%
2.45%
$0
$0 p.a.
80%
$589.12
$3,288 refinance cashback offer
Get a low interest variable rate loan with no ongoing fees. Plus you can make extra repayments and free redraw online. If you're refinancing $250,000 or above you can get a $3,288 cashback. Terms and conditions apply.
UBank UHomeLoan Fixed
1.99%
2.33%
$0
$0 p.a.
80%
$554.81
Fix your mortgage for 1 year with a very competitive rate and no ongoing fees.
homeloans.com.au Low Rate Home Loan with Offset
2.14%
2.16%
$0
$0 p.a.
60%
$566.11
A competitive rate with no application or ongoing fees. This loan is not available for construction.
86 400 Own Home Loan Fixed
2.15%
2.62%
$250
$250 p.a.
80%
$566.87
$2,000 cashback offer
A competitive fixed rate loan from an online-only smart bank. Requires a 20% deposit. Eligible new borrowers and refinancers can get a $2,000 cashback for a limited time.
Greater Bank Great Rate Fixed Home Loan
1.69%
3.49%
$0
$0 p.a.
110%
$532.6
Requires a family member to act as guarantor.
Get one of the lowest rates on the market with this fixed rate mortgage and borrow more with help from a family guarantor. NSW, QLD and ACT residents only.
Macquarie Bank Basic Home Loan
2.49%
2.49%
$0
$0 p.a.
60%
$593.01
A competitive variable rate home loan for owner-occupiers. Requires a 40% deposit. Refinancers can switch with a convenient digital application.
ME Flexible Home Loan Fixed with Members Package
1.99%
3.33%
$0
$395 p.a.
80%
$554.81
Lock in a competitive rate for owner occupiers for two years. Comes with a 100% offset account.
Suncorp Back to Basics Home Loan
2.44%
2.45%
$0
$0 p.a.
80%
$589.12
A competitive variable interest rate loan with low fees. The establishment fee is waived if you borrow $150,000 or more.
86 400 Neat Variable Home Loan
2.19%
2.2%
$0
$0 p.a.
60%
$569.91
Get flexibility and the option to make unlimited extra repayments with this variable rate loan.
IMB Fixed Rate Home Loan
1.97%
2.81%
$449
$6 monthly ($72 p.a.)
95%
$553.31
NSW and ACT customers only. 3 years fixed interest terms and free access to redraw facility online. Available with a 10% deposit.
Well Home Loans Balanced Variable
2.17%
2.2%
$250
$0 p.a.
80%
$568.39
A very low interest rate for home buyers with 20% deposits saved. Add an offset account for a small fee.
Virgin Money Reward Me Fixed Rate Home Loan
2.04%
2.79%
$300
$10 monthly ($120 p.a.)
80%
$558.56
$3,000 refinance cashback.
Buy your home and lock in a low rate for the first two years. Get a $3,000 cashback when you switch to Virgin Money with a loan amount of $300,000 or more with an LVR up to 80%. You must apply by 27 February 2021 and settle by 27 August 2021.
Bank of Melbourne Basic Home Loan
2.49%
2.51%
$0
$0 p.a.
80%
$593.01
Up to $4,000 refinance cashback
A competitive variable rate loan. Refinancers borrowing $250,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
Well Home Loans Balanced Fixed Home Loan
1.95%
2.17%
$250
$0 p.a.
90%
$551.82
A low fixed mortgage with an optional 100% offset account. Not available for construction purposes.
homeloans.com.au Low Rate Home Loan with Offset
2.24%
2.26%
$0
$0 p.a.
90%
$573.72
This loan offers a competitive variable rate and a 100% offset account to help save you on interest repayments. This loan is not available for construction.
BankSA Basic Home Loan
2.49%
2.51%
$0
$0 p.a.
80%
$593.01
Up to $4,000 refinance cashback
A competitive variable rate loan from BankSA. Refinancers borrowing $200,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
Bank of Melbourne Advantage Package Fixed Home Loan
1.94%
3.21%
$0
$395 p.a.
80%
$551.07
Up to $4,000 refinance cashback
Lock in a low fixed rate loan for four years. Refinancers borrowing $250,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
CUA Achieve Variable Home Loan
2.35%
2.4%
$600
$0 p.a.
95%
$582.16
Home buyers can get a competitive, low-fee variable rate plus a 100% offset account. Low deposit option available. Eligible new home buyers with low deposits can apply for the First Home Loan Deposit Scheme with this lender and avoid LMI costs. Eligible refinancers can get a $2,000 pre-paid credit card when they switch to CUA.
Westpac Fixed Option Home Loan Premier Advantage Package
1.99%
3.29%
$0
$395 p.a.
95%
$554.81
Up to $3,000 refinance cashback. Lock in a very low rate for four years with this owner occupier loan. Eligible borrowers refinancing $250,000 or more can get up to $3,000 cashback. Other conditions apply.
BankSA Advantage Package Fixed Home Loan
1.89%
3.43%
$0
$395 p.a.
80%
$547.35
Up to $4,000 refinance cashback.
Fix to a low rate for two years and forget about rate rises. Refinancers borrowing $200,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
Bank of Melbourne Advantage Package Fixed Home Loan
1.84%
3.38%
$0
$395 p.a.
80%
$543.64
Up to $4,000 refinance cashback
Get a competitive home loan rate for two years. Requires at least a 20% deposit. Refinancers borrowing $250,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
loans.com.au Fixed
1.99%
2.7%
$0
$0 p.a.
80%
$554.81
Home buyers can lock in this low fixed rate for two years. This loan also allows extra repayments. Requires a 20% deposit.
BankSA Advantage Package Fixed Home Loan
1.99%
3.26%
$0
$395 p.a.
$554.81
Up to $4,000 refinance cashback
A competitive fixed rate loan. Refinancers borrowing $200,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
Heritage Bank Fixed Rate Home Loan
2.19%
4.23%
$600
$8 monthly ($96 p.a.)
95%
$569.91
Get a partial offset account and the option to make interest-only repayments.
St.George Fixed Rate Advantage Package
1.94%
3.21%
$0
$395 p.a.
80%
$551.07
Up to $4,000 refinance cashback
Lock in a very low rate for four years. Requires a 20% deposit. Refinancers borrowing $250,000 or more can get up to $4,000 cashback (Other terms, conditions and exclusions apply).
Athena Variable Home  Loan
2.24%
2.21%
$0
$0 p.a.
70%
$573.72
A low variable rate for owner occupiers with 30% deposits. No upfront or ongoing fees.
Newcastle Permanent Building Society  Premium Plus Package Fixed Rate
2.28%
3.84%
$0
$395 p.a.
95%
$576.78
$2,000 refinance cashback
Enjoy a competitive rate with no application fee for this package loan. $2,000 cashback for eligible refinancers borrowing $250,000 or more.
ME Flexible Home Loan Fixed with Members Package
2.09%
3.27%
$0
$395 p.a.
80%
$562.33
Get a low 3 year fixed rate with a 100% offset account and package discounts.
Greater Bank Great Rate Discount Variable with Family Pledge Home Loan
2.59%
2.6%
$0
$0 p.a.
110%
$600.83
Pay no deposit or LMI and get a discounted rate with this family pledge loan. Requires a family member to act as guarantor. NSW, QLD and ACT only.
IMB Budget Home Loan
2.58%
2.64%
$449
$0 p.a.
80%
$600.05
A competitive variable rate for borrowers with 20% deposits saved. Available for NSW and ACT borrowers only.
Well Home Loans Balanced Fixed Home Loan
2.29%
2.29%
$250
$0 p.a.
90%
$577.55
A competitive 3 year investor rate with principal and interest repayments. Optional offset account with a $10 monthly fee. Not available for construction purposes.
homeloans.com.au Low Rate Home Loan with Offset
2.69%
2.52%
$0
$0 p.a.
80%
$608.71
A competitive rate with no application or ongoing fee. This loan is not available for construction.
ME Basic Home Loan
2.58%
2.6%
$0
$0 p.a.
80%
$600.05
This variable rate loan keeps the features simple and fees low. This loan is offered by a 100% online lender.
UBank UHomeLoan Fixed
2.14%
2.35%
$0
$0 p.a.
80%
$566.11
A one year fixed rate offer with no ongoing bank fees.
Heritage Bank Discount Variable Home Loan
2.59%
2.64%
$600
$0 p.a.
80%
$600.83
Family guarantee option available. Enjoy flexible repayments and a low minimum loan amount.
UBank UHomeLoan Fixed
2.14%
2.71%
$0
$0 p.a.
80%
$566.11
Investors can enjoy flexible repayments and an easy application process with this pioneering online lender.
ME Flexible Home Loan Fixed
2.64%
4.65%
$0
$0 p.a.
80%
$604.76
Lock in a competitive rate for 2 years, unlock package discounts and use a 100% offset account to minimise interest payments.
Heritage Bank Advantage Package Fixed
2.39%
3.15%
$0
$350 p.a.
95%
$585.25
Get a partial offset account and flexible repayments with this package loan.
Macquarie Bank Offset Home Loan Package
2.49%
2.76%
$0
$0 p.a.
60%
$593.01
A sharp variable rate with low fees for borrowers with 40% deposits or refinancers with equity in their properties. Refinancers can switch with a convenient digital application.
loans.com.au Smart Booster Discount Variable Home Loan
1.99%
2.71%
$0
$0 p.a.
80%
$554.81
If you have an owner occupier loan with loans.com.au you can also get this very low rate variable mortgage for your investment property. Principal and interest repayments. Add an offset account for an additional 0.10% on your interest rate.
Newcastle Permanent Building Society Real Deal Home Loan
2.59%
2.63%
$595
$0 p.a.
80%
$600.83
$2,000 refinance cashback
$2,000 cashback for eligible refinancers borrowing $250,000 or more.
St.George Basic Home Loan
2.54%
2.56%
$0
$0 p.a.
90%
$596.91
$2,000 cashback.
With this competitive variable rate loan from St.George, refinancers borrowing $250,000+ can get a $2,000 cashback (terms, conditions & exclusions apply)
Macquarie Bank Basic Fixed Home Loan
2.19%
2.53%
$0
$0 p.a.
80%
$569.91
Borrow up to $750,000 with this basic 3 years fixed rate home loan. Refinancers can switch with a convenient digital application.
Well Home Loans Balanced Fixed Home Loan
2.04%
2.17%
$250
$0 p.a.
90%
$558.56
A low 3 year fixed rate for home buyers. Add a 100% offset account with a $10 monthly fee. Not available for construction purposes.
IMB Budget Home Loan
2.68%
2.74%
$449
$0 p.a.
95%
$607.92
NSW and ACT customers only. You can get an interest rate discount for a limited time with this competitive variable mortgage.
homeloans.com.au Low Rate Home Loan with Offset
2.59%
2.61%
$0
$0 p.a.
90%
$600.83
Save on interest with a free 100% offset account and buy your property with just a 10% deposit. This loan is not available for construction.
Bank of Melbourne Basic Home Loan
2.54%
2.56%
$0
$0 p.a.
90%
$596.91
$2,000 cashback
A competitive variable rate loan. Refinancers borrowing $250,000 or more can get a $2,000 cashback (Other terms, conditions and exclusions apply).
Well Home Loans Balanced Variable
2.52%
2.55%
$250
$0 p.a.
90%
$595.35
A very low variable interest rate for borrowers with a 10% deposit. Add a 100% offset account for $10 a month. Not available for construction purposes.
Virgin Money Reward Me Variable Home Loan
2.59%
2.76%
$300
$10 monthly ($120 p.a.)
60%
$600.83
$3,000 refinance cashback.
A variable rate loan for owner occupiers with a 40% deposit (or equity) borrowing under $500,000. Get a $3,000 cashback when you switch to Virgin Money with a loan amount of $300,000 or more with an LVR up to 80%. You must apply by 27 February 2021 and settle by 27 August 2021.
Athena Variable Home  Loan
2.54%
2.54%
$0
$0 p.a.
60%
$596.91
Investors with large 40% deposits or equity can get this low variable rate. A competitive option for investors looking to refinance.
UBank UHomeLoan Variable Rate
2.74%
2.74%
$0
$0 p.a.
80%
$612.67
Get a discounted, low-fee investor loan from a convenient online lender. 20% deposit required.
Newcastle Permanent Building Society  Premium Plus Package Fixed Rate
2.19%
3.72%
$0
$395 p.a.
95%
$569.91
$2,000 refinance cashback
Enjoy a discounted fixed rate and the ability to package the loan with other financial products. $2,000 cashback for eligible refinancers borrowing $250,000 or more.
Athena Variable Home  Loan
2.59%
2.56%
$0
$0 p.a.
70%
$600.83
Athena's refinance offer for investors and owner occupiers.
Newcastle Permanent Building Society Fixed Rate Home Loan
2.29%
4.31%
$595
$0 p.a.
95%
$577.55
$2,000 refinance cashback
Borrow up to 95% LVR of the value of the property you're buying and pay no ongoing fees. $2,000 cashback for eligible refinancers borrowing $250,000 or more.
UBank UHomeLoan Fixed
2.09%
2.6%
$0
$0 p.a.
80%
$562.33
Pay no ongoing fees on this investment loan fixed for 3 years.
ME Flexible Home Loan With Member Package
2.59%
3.05%
$0
$395 p.a.
80%
$600.83
$2,000 cashback offer
A competitive variable rate package home loan with a 100% offset account. Eligible refinancers can get a $2,000 cashback.
Newcastle Permanent Building Society Fixed Rate Home Loan
2.38%
3.72%
$595
$0 p.a.
90%
$584.48
$2,000 refinance cashback
Competitive fixed rate for home buyers.Available with a 10% deposit.$2,000 cashback for eligible refinancers borrowing $250,000 or more.
Athena Variable Home  Loan
2.64%
2.59%
$0
$0 p.a.
80%
$604.76
A competitive investor variable rate that falls as you build equity.
Newcastle Permanent Building Society Premium Plus Package Home Loan
2.94%
3.34%
$0
$395 p.a.
95%
$628.65
$2,000 refinance cashback
New borrowers or refinancers can get a discounted rate with this package loan. $2,000 cashback for eligible refinancers borrowing $250,000 or more.
HSBC Home Value Loan
2.54%
2.55%
$0
$0 p.a.
90%
$596.91
A competitive value home loan with no ongoing fee.
UBank UHomeLoan Fixed
2.24%
2.64%
$0
$0 p.a.
80%
$573.72
Pay no ongoing fees on this investment loan fixed for 3 years.
Macquarie Bank Basic Home Loan
2.64%
2.64%
$0
$0 p.a.
80%
$604.76
Pay no application and ongoing fees and take advantage of split and redraw options. Refinancers can switch with a convenient digital application.
UBank UHomeLoan Fixed
2.09%
2.3%
$0
$0 p.a.
80%
$562.33
A competitive 3 year fixed rate with no ongoing bank fees.
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26 Responses

    Default Gravatar
    DominicOctober 31, 2018

    Can a guarantor use an overseas property as security for the loan? For example, the guarantor has property and lives in NZ and I am to purchase a house in Australia. Is the guarantor able to use the property in NZ as security for purchasing a house in Australia?

      Avatarfinder Customer Care
      JhezNovember 9, 2018Staff

      Hello Dominic,

      Thank you for your comment.

      Please be advised that the guarantor eligibility criteria may vary per lender, however, you may refer to the general requirements below:

      • A guarantor needs equity in their property and a stable income to satisfy lenders.
      • Your guarantor should have a good personal credit rating.
      • Lenders generally want a guarantor to be an Australian citizen or permanent resident.
      • A guarantor must be over 18 and typically under 65.

      You may refer to our list of guarantor home loans.

      Please note that a guarantor cannot use the overseas property as security to assist. The property security would have to be in Australia.

      Should you wish to have real-time answers to your questions, try our chatbox on the lower right corner of our page.

      Regards,
      Jhezelyn

    Default Gravatar
    DavidOctober 5, 2017

    I have HOUSE A as security for HOUSE B (HOUSE A is totally debt free and I live in it and is in MY name, and HOUSE B is in both my son’s name AND mine as joint owners. My son makes ALL the repayments on HOUSE B). If I died then HOUSE A is to be sold and HOUSE B gets left to my son. Does ALL the money from the sale of HOUSE A have to pay off HOUSE B or can I pay some of it off to reduce his loan and leave the remaining funds to others in my estate? I hope you can follow this.

      Default Gravatar
      DanielleOctober 5, 2017

      Hi David,

      Thank you for contacting Finder.

      There are three main factors that determine what will happen if you have a mortgage when you die: your will, your mortgage agreement, and your insurance policies. Check our guide to find out more.

      I hope this helps.

      Cheers,
      Danielle

    Default Gravatar
    SueJuly 15, 2017

    Can an unencumbered vacant block of rural land used for commercial purposes of farming be offered as security by the guarantor in a limited guarantor home loan?

      Default Gravatar
      LiezlJuly 21, 2017

      Hi Sue,

      Thanks for your question.

      The type of real estate that can be used as security guarantee varies between lenders depending on the loan amount and the portion of the loan guaranteed by the guarantor. It’s a good idea to enquire from the lenders directly, better still approach a mortgage broker for advice tailored to your needs.

      Cheers,
      Liezl

    Default Gravatar
    chrisMay 25, 2017

    hi
    i have a house on crown land we rent the ground but the house is ours can i use the house to borrow for the land with out a deposit

      Avatarfinder Customer Care
      DeeMay 29, 2017Staff

      Hi Chris,

      Thanks for your question.

      Lenders have different criteria when it comes to properties that can be accepted as a security for a home loan. The general rule is the easier a property is to sell and the higher the demand for that particular type of property, the better the chances of a lender accepting it as loan security.

      You may compare your home loan options on our website for further details. Once you have selected a particular lender, you may have to directly get in touch with them to discuss the eligibility of your property as a security.

      Be sure to speak to a mortgage broker as well. A mortgage broker is a professional who compares and helps you apply for home loans on your behalf. A good mortgage broker will give you personalised service all the way through to settlement.

      I hope this helps.

      Cheers,
      Anndy

    Default Gravatar
    GinaApril 28, 2017

    Hi,
    My husband and I would like to purchase a property. We don’t have a deposit but would like to use my property as collateral, is this accepted or do we still require a deposit. Bearing in mind the property I will be using is in joint names with my sister in law. Do i need to ask for her permission also?

    Thanks

      Avatarfinder Customer Care
      HaroldMay 8, 2017Staff

      Hi Gina,

      Thank you for your inquiry.

      Please note that most lenders would require 20% deposit if you’re taking a regular home loan. However, there may be options in the market that you can compare, please refer to the pages below:

      1. Cheapest Home Loans
      2. Low Deposit Home Loans – Although you may have to get a guarantor for this type of loan
      3. First Home Owners Grant – If it’s your first time to buy a home, then you may also check if you’re qualified for a grant in your local state.

      Alternatively, you can reach out to a mortgage broker who will take all your circumstances into account and offer you a range of lending options.

      I hope this information has helped.

      Cheers,
      Harold

    Default Gravatar
    KylieFebruary 14, 2017

    Hi,
    My husband and I are looking at getting his parents to go guarantors for us, the house they have might be Heritage listed. Will this make it ineligible to be used ?

    Thanks

      Avatarfinder Customer Care
      DeeFebruary 15, 2017Staff

      Hi Kylie,

      Thanks for your question.

      Lenders generally shy away from properties that are listed on a state or federal heritage protection list because these properties come with a wide range of restrictions and there aren’t as many people interested in purchasing such a property.

      However, this doesn’t mean all lenders are unwilling to approve a home loan if your security is a heritage property. You may have to directly get in touch with the lenders you are interested in to inquire.

      If you are interested, you can first compare your home loan options. Once you have selected a lender, you can directly get in touch with them to inquire if they are willing to accept your security.

      Alternatively, you may also get in touch with a mortgage broker who is able to assist you in finding a suitable home loan option.

      Cheers,
      Anndy

      Default Gravatar
      KylieFebruary 15, 2017

      Thanks for the reply.
      The house we will be using is the heritage listed property not the one we want to buy, so why would using a heritage listed property as equity be a problem? They are not looking at selling their property just use it to help us buy our own house ?
      If that makes sense ?

      Avatarfinder Customer Care
      DeeFebruary 17, 2017Staff

      Hi Kylie,

      Thanks for getting back.

      You mentioned that you are applying a home loan with your husband’s parents as guarantors and they have a home which might be heritage listed.

      In a home loan with a guarantor, the guarantor’s own home is often used as a security, so this would be the property of your husband’s parents. If you cannot repay your home loan, the bank can sell the property to recover their costs.

      In our page above, we have listed Heritage Homes as among the properties which cannot be used as security. Other lenders may consider this but you’ll have to directly get in touch with them to inquire. Alternatively, you can get in touch with a mortgage broker to assist you in finding a suitable home loan option.

      Cheers,
      Anndy

    Default Gravatar
    JillOctober 8, 2016

    I have been told by a Loans Broker that I can release the property being used as security, on a new property, after 20% of new mortgage has been repaid. Is this correct? Thank you

      Avatarfinder Customer Care
      DeeOctober 10, 2016Staff

      HI Jill,

      Thanks for your question.

      Please note that we are a financial comparison and information website and we do not provide expert advice on mortgages.

      A property used as a security for a home loan is generally released once the standard LVR requirements of the loan product have been met due to loan repayments. So if a property is used as a guarantee for say 20% of the loan and the equivalent amount has already been repaid, then the property may be released. Your mortgage broker or lender should be able to organise this for you.

      Cheers,
      Anndy

    Default Gravatar
    GeorgeMay 31, 2016

    I own a property which is used as security for a mortgage on a house my son has purchased about 2 years ago. I want to sell my property and buy elsewhere. Can I sell and transfer the security to the other property I intend to buy. My son’s house valuation may not qualify him for re-finance.

      Avatarfinder Customer Care
      MarcJune 2, 2016Staff

      Hi George,
      thanks for the question.

      I would recommend contacting your son’s lender to find out what their policy will be regarding this. They’ll be able to advise whether or not this will be allowed.

      Sorry I couldn’t be of more help to you,
      Marc.

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    tommyFebruary 21, 2016

    i want to borrow 50k i will use my house thats worth 100k i own this house outright i dont owe nothing on it but i have bad credit what would be the chance of getting this loan with the loan i want to pay off all my bills and finish up on a few projects on and around the house

      Avatarfinder Customer Care
      MarcFebruary 22, 2016Staff

      Hi Tommy,

      Thanks for the question.

      Your chance for a loan such as this will depend on the lender you approach, in addition to the other usual factors: your debts, credit file, assets, liabilities and income. You may want to compare your bad credit loan options and you can also consult with a mortgage broker. A broker can help you understand your financial position and they can leverage their panel of networks to find a lender that’s more inclined to review your application.

      Before applying, please ensure that you meet all the eligibility criteria and read through the details of the needed requirements as well as the relevant Product Disclosure Statements/Terms and Conditions when comparing your options before making a decision on whether it is right for you.

      I hope this helps,
      Marc

    Default Gravatar
    leanneSeptember 1, 2015

    Hi
    Could you please advise if I want to put my home up as security to purchase a property for my daughter, could you confirm whether I have to seek finance through the same lender.

      Default Gravatar
      JodieSeptember 1, 2015

      Hi Leanne,

      Thank you for your question.

      It would depend on whether you are wanting to use your property as security to co-guarantor for your daughter to take out her own loan. In which case, you would not have to seek finance through the same lender as it would be your daughter who is seeking finance.

      If you are simply using the equity in your home to obtain more finance in order to purchase a property for your daughter where she is not the person seeking the loan, you will need to look at your refinancing options whether it be with the same lender or a new lender.

      If you still have funds owning on your property this will limit the amount a lender will offer you as a loan but if you own your property outright you have all the equity available to use.

      It would be recommended that you seek personal legal and financial advice and possibly speak to a mortgage broker before going forward with any decision that puts your property up as security as there are implications relating to your property that you would need to consider before making this decision.

      Regards,
      Jodie