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Temporary Resident Home Loans & Mortgages
This is a short presentation by Craig Vaughan of MAP Home Loans on arranging a home loan to purchase property in Australia whilst on a temporary resident visa or as a non resident. The video covers the deposit requirements and eligibility requirements to arrange mortgage approval as well as briefly covering the steps involved in purchasing a home or investment property in Australia.
MAP Mortgage Brokers is often contacted by Australian temporary residents (that is, foreign citizens who do not hold permanent residency) seeking a home loan to borrow over 80% of the purchase price. They have often approached their own bank and possibly one or two mortgage brokers and have been advised that their maximum lend is 80%.
MAP specialises in assisting temporary resident migrants with home loans to 95% LVR at normal bank interest rates where they are purchasing with their Australian citizen or permanent resident partner or spouse.
457 Visa Mortgage to 90% LVR
MAP can also assist subclass 457, 475, 487 and 495 visa holders living and working in Australia with a 457 Visa home loan to 90% LVR and will guide you through the entire process including FIRB approval.
If you have a deposit of 20% or more, MAP can still assist as every bank has their own individual policies, procedures and different specials on offer at different times.
Maximum Lending ratios for Temporary Residents
|Borrower Type||Max Home Loan Lending|
|Australian citizen buying with their temporary resident foreign spouse or partner (married or defacto) - See Spouse Visa Home Loans here||95% + LMI|
|Australian permanent resident (including NZ Citizens) purchasing with their temporary resident partner / spouse - See Permanent Resident Home Loans||95% + LMI|
Non Resident living in Australia on a subclass 457, 475, 487 or 495 visa without permanent resident. See 457 Visa Home Loan
NZ Citizen living in NZ purchasing Australian Investment Property. NZ Citizen Home Loans
|Foreign Citizen moving to Australia on a working visa valid for 4 years (such as a subclass 457 or 422 visa): See Migrating to Australia Home Loan||80%|
If you are purchasing with an Australian Citizen / Permanent Resident and you hold either a subclass 457, 300, 309, 820, bridging visa A or B, 461 visa, or any other visa that permits you to work in Australia (excluding tourist visa's), standard lending policy applies and 95% is available.
Migrant Home Loan Lending Ratios for Specific Subclasses
The minimum deposits required by Migrants on temporary provisional visas will vary depending on the subclass of visa and occupation of the holder. Effectively, some banks and non-bank lenders have determined that certain visa holders will be a satisfactory lending risk given that;
- Permanent residency (PR) is likely to be achieved, and
- the occupation of the migrant is in demand or stable employment history.
Here are some of the most common visas banks will extend mortgage finance to and the minimum deposit required:
- Migrants on a 457 Visa can borrow with as small as a 10% deposit for their Australian purchase: See 457 Visa Home Loan
- Migrants on a Subclass 487 visa can borrow with as small as a 10% deposit: See Home Loans for Non Resident on Subclass 487 Visa
- Migrants on a Skilled Graduate 487 Visa can borrow mortgage finance with only a 10% deposit: See 487 Visa Home Loans
- Migrants on a Skilled Regional Visa 495 can borrow up to 90% of the purchase price.
- Migrants on a Bridging Visa A or B can be approved a mortgage with only a 20% deposit.
- Student Visa holders will be limited to 80% of the purchase price for their Australian home purchase: See Student Visa Mortgage
This is not an exhaustive list and most other types of visas that permit the migrant to work in Australia will be accepted with a 20% deposit.
If purchasing with an Australian citizen or permanent resident then disregard the above and note that only a 5% deposit plus purchasing costs is required in this scenario.
What does Borrowing over 80% mean to you?
Whether you are a temporary resident or not, contributing 20% plus purchasing costs to purchasing your home may not be possible for many. Further, you may have the required funds to borrow at 80% but this would leave you limited funds in case of an emergency.
Below is an example loan scenario for a purchase of $400,000 residential property in NSW at 80% and 95%. Note that The 95% structure may not be suitable but perhaps an LVR of 85 - 90% may make a significant difference to your finances. it is worth remembering also that the LMI premium works on a sliding scale so the bigger your deposit and therefore lower the LVR, the cheaper the LMI premium will be. Please note that the below figures are estimates only.
|ESTIMATE OF FEES (NSW)|
|Lender Fees (e.g. application, settlement excl LMI)||150||150|
|Government Charges (Registration & Stamp Duty)||13,775||13,775|
|Miscellaneous (e.g. build/pest & Solicitor)||2,000||2,000|
|Lenders Mortgage Insurance (LMI)||-||10500|
|SUBTOTAL FEES & CHARGES||15,925||26,425|
|PURCHASE PRICE + FEES||415,925||426,425|
|HOME LOAN STRUCTURE|
|Proportion of Home Loan towards Purchase||320,000||377,500|
|Proportion of Home Loan towards LMI||-||10,500|
| HOME LOAN TOTAL
|First Home Owners Grant (FHOG) $7000 if applicable||-||-|
|OWN FUNDS REQUIRED||95,925||38,425|
|INTEREST RATES AND REPAYMENTS|
|Loan Current Interest Rate example (Variable)||6.69% p.a.
(comp rate 6.83%)
|Loan Mthly Repayments P&I (Variable) + Fees||$2060||$2498|
Case Study: Contracting Doctor on 457 Visa Approved at 90% LVR Without Having to Pay Lenders Mortgage Insurance
Arlyn Z: Townsville
- Arlyn was from the Philippines and was contracting as a GP to a private medical centre (ie, self employed)
- Was on a 457 visa however application for permanent residency had been lodged
- Her bank had declined due to Visa and income source (wanted her to wait 2 years)
Key Results after Approaching MAP
- Approved 90% LVR to purchase house and land package
- No Lenders Mortgage Insurance Paid under Medico Legal Package due to occupation
- Arlyns home will begin to be built shortly and she is looking forward to moving in
Thanks so much!
All credit goes back to you as you helped me make this all happen.
I couldn't thank you enough for the job excellently done.