Home loans 'more likely to go to those responsible with cash'
Article by Mozo
Aussies hoping to secure home loans in the near future should take steps to ensure they can show how responsible they are with money.
According to Rams Home Loans' Nigel Lopez-McBean, it is difficult for some to save up enough for a deposit and pay rent on their current accommodation, reports news.com.au.
He explained that being careful and saving a small amount can show to lenders that prospective borrowers are capable of handling their finances.
"Genuine savings are seen as step-by-step increases in your bank account or savings that have been untouched for three months and this can be a real stumbling block for some," he stated.
Currently, those applying for home loans need to save at least a five per cent deposit in order to secure financing for a property.
Last month, Lisa Montgomery, chief executive of Resi Home Loans, told the Sydney Morning Herald that one way to reduce the overall amount paid back to lenders is to compare home loans and get a lower rate but to continue repaying the same quantity as before.
Have a question about home loans? Ask the money gurus at Mozo Answers.