Family Pledge - Intech Credit Union
|Buying a home can be a difficult process. There’s the stress of finding the home but also the stress of |
saving enough money for a deposit and the high cost of Lenders’ Mortgage Insurance.
Intech Credit Union’s Family Pledge loan is your solution to owning your home sooner.
|What is a Family Pledge loan?|
|Intech’s Family Pledge home loan allows people who do not have a deposit or sufficient savings to purchase a property with the support of a family member.|
Applicants can borrow up to 110% of their new property’s value – to help with up-front expenses like stamp duty and legal fees. The loan is secured by both the property that is being purchased and the property owned by a family member, who will act as a guarantor for a portion of the loan.
|How does a Family Pledge/guarantee work?|
|A family member who has sufficient equity in their home or investment property can guarantee a portion of the value of their property against a loan held by their child(ren). The guarantee will be limited to the portion of the loan exceeding 80% of the borrower’s new property value and the total amount of the guarantee is not to exceed 50% of the guarantor’s property value. A guarantor must obtain independent legal advice and may seek financial advice. |
The maximum loan can be up to 110% of the purchase price. The applicant(s) must be able to demonstrate capacity to afford the full loan amount on a Principal and Interest (P&I) basis on their own (guarantees are for security purposes, not servicing purposes).
|What is the maximum amount the Family Pledge/loan can cover?|
|The maximum commitment secured by the family member’s real estate assets is not to exceed 50% of their property’s value.|
|How is the loan structured?|
|Initially the loan is split between a P&I and Interest Only. The P&I portion is the guaranteed component and is paid off more quickly so that the guarantee may be released. Interest only payments on the non-guaranteed loan means the guaranteed loan is repaid as fast as possible. Once the guaranteed loan is paid off, the interest only loan can be restructured.|
|What are the benefits?|
|The Family Pledge loan allows the borrower to:|
|Who can be a guarantor?|
|Guarantors are restricted to immediate family e.g. parent(s), grandparent(s), siblings or close relatives. All guarantees are limited to the required level of assistance and must be supported by a registered first mortgage over an established dwelling.|
|Click here for more information on Family Pledge.|
|Products issued by Intech Credit Union Ltd ABN: 70 087 650 191. AFSL & Australian Credit Licence 236779. Terms and conditions, fees and charges and lending criteria apply. |