When stepping onto the property ladder, it’s easy to get overwhelmed by the jargon and complexity that comes with home loans. Many prospective homeowners miss out on understanding the profound impact a significant deposit can make. At Archer Mortgage Group, we believe in empowering our clients by providing them with knowledge to make informed decisions. That’s why we’re here today to unveil the potential benefits of having a robust home loan deposit.
Break Down The Barriers with Bigger Deposits
Sure, it’s no secret that saving for a deposit is a daunting task, but remember, the advantages far outweigh the effort. A larger deposit could mean smaller monthly repayments, saving you from financial strain and stress over the years. It helps you borrow less and pay less interest, making the entire journey more affordable.
Dodge the Lenders Mortgage Insurance (LMI)
Did you know you could potentially avoid paying Lenders Mortgage Insurance (LMI) with a significant deposit? Typically, if you borrow more than 80% of your property’s value, most lenders require you to pay LMI. This is a safeguard for the lender, not the borrower. It can be an expensive addition to your loan. A substantial deposit can reduce your loan-to-value ratio, possibly exempting you from this additional cost.
Score Better Interest Rates
A hefty deposit could unlock the door to more attractive interest rates. It’s all about the risk factor for lenders. A larger deposit means you’re borrowing less, reducing the risk for your lender, and in turn, they might offer you a better interest rate. It’s a win-win situation for both parties involved.
Boost Your Borrowing Power
The size of your deposit can directly impact how much you can borrow. A more substantial deposit gives lenders more confidence in your financial capacity to repay the loan. In turn, they may offer you a larger loan amount, increasing your purchasing power and opening up a wider range of properties for you to consider.
So, how do you leverage these benefits? It starts with partnering with a trusted advisor. At Archer Mortgage Group, we’re dedicated to guiding Australians on their path to homeownership. With our industry knowledge, experience, and a wide range of mortgage options, we can help you build a secure financial future.
Ready to embark on your homeownership journey? Talk to us at Archer Mortgage Group today and discover how a larger home loan deposit can unlock countless opportunities for you.
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