Assisting First Home Buyers

Lenders Mortgage Insurance (LMI) enables lenders to offer higher loans on a property's value, helping first home buyers into the property market. According to recent statistics the residential mortgage backed securities (RMBS) market in Australia, on which sales of LMI depend, rose 20% in 2006 to A$63 billion (Axiss Australia's newsletter February 2007) This makes Australia the fourth biggest market in the world, after the US, UK and Spain.   Peter Morgan, head of St.George Insurance Australia Pty Ltd (SGIA) explains, "Without mortgage insurance interest rates on loans would be higher. With the availability of LMI, lenders can provide higher loan-to-value loans. This means they will lend an amount closer to the sale price of a property. This has allowed first home buyers to purchase homes earlier because they will need a smaller deposit.   This is excellent news for anyone saving their deposit to purchase their first home. The First Home Owners Grant will help to cover purchase costs and now borrowers only requiring to save a small deposit, can enter into the property market earlier.   Call us now for your FREE consultation to see if we are able to help you with the purchase of your first home.