Your Questions About Home Loan Rates

Helen asks…

What was your credit score when you recieved a home loan?

I have a credit score of 618. Is this enough for me to apply for a home loan?

John answers:

Mine was 680 and I got approved with no problems. You will probably get a loan, though it won’t necessarily be as good of an interest rate if you had had like 800 plus instead.

Mandy asks…

What is the average deposit for a home loan in Australia?

Hi all.

Im starting to look into buying a house. Im only young, just thinking about entering into the huge realestate market.

What is the average deposit for a home loan?

John answers:

It completely depends on where you are trying to buy. The less expensive the property the less deposit you will need. If you are trying to buy a house in Perth or Sydney the deposit will be a lot more than a similar house in Adelaide or Hobart for example. A traditional mortgage may require you to have 20% up front or in equity. You can now get non conforming loans where you can actually borrow up to 105% of the property value providing you have the income to make the repayments. They will charge you extra interest as they are taking a higher risk in lending to that ratio but after a few years the capital growth in the property should allow you to refinance the mortgage at standard rates as you will have built enough equity to get a conforming loan.

Maria asks…

do you have to put a down payment down with the VA home loan ?

what are the advantages of the va home loan and the disadvantages. like interest rates ?
even with the new changes in the housing market
even with the new changes in the housing market
even with the new changes in the housing market are veterans required to put down 20% like everyone else

John answers:

VA home loan does not require a down payment and it covers most of the closing costs, actually requires that they are paid by the seller. It does however have a :VA Funding Fee” that will be rolled into the price of the mortgage at closing. Usually what happens is that the vet pays nothing down and very little at closing but that most of these fees are added into the loan and financed over 30 years. It will allow the vet with no cash on hand to buy a house. After that you are on your own. Unless you default, then the VA pays off the loan and your not haunted by it forever.
If you have some money there are better loan programs available especially if you are a first time home buyer.

Jenny asks…

Difference between a personal loan and a home loan?

If I was to borrow say $30,000 in Australia to pay the remainder of a home loan, what would be the difference between taking out a personal loan and a home loan to pay it off?

John answers:

Personal loans have a much shorter repayment rime (2-5 years) and the interest rate is higher (around 16% compared with 7% with a home loan). You will end up paying alot more interest if you do what you are planning.

Sandy asks…

With a credit score of 619 can I get a home loan?

I have three unpaid medical bills from four years ago on my account. I was going to pay it off (I can afford to now) but I’ve hread it will lower my score and make it more recent. I also have student loans of 50,000. I just paid down my two credit cards to 10 % of my available credit. I’m going to wait until October to apply for a home loan. I am hoping my credit cards pay off will make my score rise by then.

John answers:

Yes you can get a Home Loan. . . Depending on your payment history and yoru score and your debt to income ration, you may have to make a higher down payment, and your interest may be higher.

You may want to consider this before you apply. You should continue to rent for a few more years, pay off 90% of your revolving debt, pay down your student loans as much as possible. You do not want to put yourself in a bind. I do not know your financial situation but you want to pay off that dept as soon as possible so you can put that extra money somewhere else.

Idea. . . . If you have not consolidated your student loan debt, you should do that, but leave the smallest ballance un-consolidated. The reason for doing this, if all of your accounts are consolidated then you cannot consolidate again because they are already done so. Why would you want to consolidate again, because interest rates may drop a few points, and it will save you thousands.

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