Temporary Resident Home Loans & Mortgages

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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

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;

1. Permanent residency (PR) is likely to be achieved, and
2. 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:

1. Migrants on a 457 Visa can borrow with as small as a 10% deposit for their Australian purchase: See 457 Visa Home Loan
2. 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
3. Migrants on a Skilled Graduate 487 Visa can borrow mortgage finance with only a 10% deposit: See 487 Visa Home Loans
4. Migrants on a Skilled Regional Visa 495 can borrow up to 90% of the purchase price.
5. Migrants on a Bridging Visa A or B can be approved a mortgage with only a 20% deposit.
6. 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.

FINANCIAL DETAILS	Standard 80%	MAP Option 95%
PURCHASE PRICE	400,000	400,000
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	320,000	388,000
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

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