How much can my friend borrow?

[Kinnon Bell]

80% loan to avoid LMI --> 20% of $450k is $90k + other settlement costs ie B&P, legals etc

 

[Jess Peletier]

To avoid lmi you'd need 20% deposit plus stamps and costs, so approx $100k on a $450k purchase, assuming stamps are $7k and $3k for costs.

 

[Marty McDonald]

xcept she would be 77 and I am seeing many lenders under the guise of NCCP asking for loan terms concluding at 65 to 70 depending on what the borrower does for a living.

In this case, could be further complicated by my assumption of not much retirement money/super/exit strategy.

ta
rolf

Quite right I meant 23 year term to align with many lenders retirement rule age of 75 years old.

 

[kathryn d]

Wylie,
Have you considered the possibility of buying a house, and then allowing her to Rent to Own it?

I think you call it wrapping?

We have done it here.
The property stays in our name, until paid for.

All done with our lawyers.

You charge a small mark up, and she gets a property now.

 

[wylie]

Good idea Kathryn, but we will be needing all we can scratch up to develop our block.

I've just come home from her mother's place. She at least can open some windows now.

She has about $130K super and she will ask her mother if there is any chance of a "gift" to be "repaid when able" so it can be ignored by the banks. If not, then she obviously just has to save up. In this case, she is better to pay some LMI because it gets her into the market before it gets out of her reach.

And that is a big concern with the Brisbane market. It is starting to move.

I'm sure there was a thread recently where it was said some banks will issue a personal loan that can be used as a deposit.

Any idea if this could work?