Not always. Dependent on your circumstance you may be eligible for government schemes or be able to utilise family guarantee products instead.
What is a family guarantee?
A Family Guarantee allows your family, generally your parents, to provide their property as additional security to guarantee part of your home loan. This would allow you to borrow a high percentage of the property value (even up to 100%) without having to pay LMI.
What is mortgage insurance (LMI)?
LMI is a cost which you the borrower pay at settlement of your loan that protects the bank in case you default on the loan and they must sell the property at a loss. It is important to understand that LMI does not protect you if you get sick or lose your job. To avoid paying LMI you generally need to borrow less than 80% of the value of the property.
How much can I borrow?
There are numerous factors that influence how much you can borrow; your income, your financial commitments (credit cards/car loans/HECS etc.) & your living expenses. However, every bank will assess your borrowing capacity differently & that's why it pays to have us in your corner as we have access to over 40 different lenders.