If I earn 60k a year and have 25k deposit - how much will the bank lend me for a home loan? (Australia)?

Question

How much could I afford to pay off?

Assuming I owe nothing else and have an excellent credit rating.

Answer 1

The answer depends on a number of factors including if the loan is for a single person or couple, number of children, value of credit cards / other loans and expected rent if an investments property.

Unfortunately, if you are single, with no kids, no credit cards, no other debts and are buying a home to live in, Australian lenders will let you borrow somewhere around $350,000. This is what's possible to borrow, but in my opinion, it's way too much for most to afford without stressing your lifestyle.

Rather than try for the most you can afford, target something that is easily affordable. Do a budget and work out how much money you can comfortably afford to pay. Allow for added costs to purchase as well as ongoing costs for rates, maintenance, insurance, body corporate fees etc. If you get rent assistance, remember that this will cease.

If you have less than 20% deposit, you will most likely be hit with mortgage insurance. That can add a couple of thousand dollars as well.

The best advice I can give is work out how much each month / week you can comfortably afford and then ask again (or e-mail me). There's a huge difference between what you CAN borrow and what you SHOULD borrow.

Answer 2

The simplified version of the global financial crisis is due to people having house loans they could not pay back. A house loan without a deposit means you are in trouble from day 1. You will always be running to be in front. Ask yourself this. Why do you have no deposit? If you are living at home or are renting, you are better off than owning a house so you should be able to save money. Once you buy a house you have huge numbers of expenses and they can be overwhelming. Only 15 years ago in Australia most home loans were only up to 80% of the value. Any loans above that were called cocktail loans and you paid a higher interest rate due to the risk. Banks got greedy and started to loan more money and now the entire world is in trouble. Iceland is bankrupt. Yes, the whole country. My advice would be to go to the most strict bank you can find, the one who has the most rules. If they will offer you a loan, then your answer is yes. If they say no, consider yourself lucky. A first home owners grant may end up costing you more than 20 times that much in 5 years. A lot of people who have lost their home now received a first home owners grant. Get all the advice you can and good luck. The tragedy of losing a house is that you can lose a marriage and family as well.

Answer 3

i think it,s 18% they are cheap when it comes to giveing lones

Answer 4

it all depends on your credit.