How a guarantor could help you get your property sooner
Family Guarantor loans are a type of home loan that allows a family member to use their own property as security for a portion of your loan. This can be a great option for first home buyers who may not have a large deposit or may not meet the lender’s strict lending criteria.
With a family guarantee loan, the guarantor (usually a parent or family member) allows you to borrow a small part of the overall loan you need, using their property as security for the loan. This means that the borrower requires less of a deposit and can potentially borrow more and avoid the cost of lenders mortgage insurance (LMI), which can be a significant expense for many borrowers.
One of the key benefits of a family guarantee loan is that it can help you get into the property market sooner. It can also help you save money by avoiding the cost of LMI, which can be a significant expense for borrowers who don’t have a large deposit.
However, it’s important to understand the risks involved with a family guarantee loan. If the borrower is unable to make their repayments, the guarantor may be required to make the repayments on their behalf. This can potentially put the guarantor’s own property at risk.
Family Guarantor loans can be a great option for borrowers who have a trusted family member who is willing to provide security for their loan. However, it’s important to work with a trusted mortgage broker who can provide guidance and support throughout the process, helping you understand the risks and benefits of this type of loan product.
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