The Brokers Brief – Guarantor Home Loans

Have you ever had a client who was struggling to get a home loan because they didn’t have enough of a deposit saved? Or wanted to avoid paying Lenders Mortgage Insurance (LMI)?

Guarantor Loans could be an accessible option!

A Guarantor loan is where a family member ( usually a parent ) offers part of their property as security to help the borrower purchase a property. This can assist with;

✅Buying with little to no deposit

✅Avoid costly Lenders Mortgage Insurance premiums

✅Get their foot in the property market earlier

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Who can be a guarantor? Usually parents, but it can also be other family memebers or close assosciates with suitable security 

How does it work?

1. The Gurarantor offers a portion of their home’s equity as security

2. The Borrower’s loan amount is increased based on the extra security available. 

3. The Guarantor is not on the new loan ortiutle, but takes on a legal obligation to cover the guaranteed amount if the borrower defaults on their loan

Click below to watch the video and learn more;