How your profession can save money when buying property

How your job can save you money when buying property

Your job doesn’t just help you make money; when it comes time to get a mortgage, it can actually also help you save money.

This is because your career can influence not only who will lend to you, but also how much they will lend you, and how flexible the terms of your mortgage will be.

It’s a little-known secret in the mortgage industry that if your profession falls into one of your lender’s preferred categories, you can access better loan conditions and better interest rates for your mortgage.

It is all about the risk factor at the end of the day, and if you can prove to your lender that you are a ‘low risk’ purchaser, then they will be more willing to work with you and woo you as a client.

The end result is that you can actually save money when you are buying your house. Your stable employment, a clear credit history and strong financial standing are key criteria to securing a home loan that suits you.

So which kinds of professions specifically do lenders generally favour? It may include, but is not limited to:

  • Lawyers
  • Accountants
  • Auditors
  • Actuaries
  • Medical practitioners
  • Veterinarians
  • Pharmacists
  • Optometrists
  • Dentists
  • Dentists
  • Mining professionals
  • Energy professionals
  • Resource professionals
  • Surveyors
  • Quantity Surveyors
  • Engineers
  • Geologists
  • Geophysicists

Medical professionals It’s safe to say that in the view of a lender, if you are a medical professional, you are considered low risk because your employment is generally stable and well paying. Anesthetists, surgeons, specialist doctors, general practitioners, veterinarians, optometrists, psychologists – the list goes on. If you are employed in the medical industry, you will often be eligible for waived Lenders Mortgage Insurance (LMI) at LVRs of up to 90%, instead of the regular 80%, and you may be able to borrow up to $4.5 million without raising too many red flags. In addition, you should qualify for a professional home loan package, which provides for more flexible loan conditions and saves you even more money on discount interest rates and fees.

Legal and finance professionals Teachers, nurses, scientists, government employees and defense force personnel are considered professionals by most lenders. All general professionals are seen as low risk and are eligible for a waived LMI on home loans up to 85%. They also qualify for professional home loan packages and more flexibility in requirements from many lenders. Whilst having a stable, solid and professional career can help you to negotiate an even better deal on your mortgage, working in what is considered a ‘high risk’ profession can have the opposite affect.Casual workers, contract workers, self-employed and commission-income workers are considered the most high-risk borrowers. Their income is not guaranteed and their situation for the foreseeable future is not set. If you fall into one of these categories, you may need to be creative or show extra documentation in order to qualify for a competitive home loan. Regardless of your career and or the property you’re trying to buy, call us today on 1300 397 287; we will aim to help you make your job work for you so you can get the best home loan possible, and save money along the way.

Legal professionals such as lawyers, barristers and solicitors, along with finance experts including accountants, finance managers and auditors – and now even mining professionals like engineers, surveyors, geologists and geophysicists – are also seen as low risk by lenders. IT Managers, executives and architects may be included in this category as well. If your career falls under this category, you may qualify for waived LMI for up to 90% of the property purchase price. Your income must be over $150,000 and you have to meet the criteria about stable employment. The professionals in this category are also eligible for professional home loan packages where they can access lower interest rates and fees.

Professional loans can save you money

How a professional loan could save you $20,000

If you shuffle between important meetings at work and are responsible for making big decisions, then the odds are, you’re working in a professional capacity. And if this is the case, you could stand to save tends of thousands of dollars when you decide to buy your next home or investment property.

A professional home loan package can save you a significant amount off the cost of your loan. Why? Because lenders want to attract low risk borrowers and high-income earners, so they offer special features and rates that aren’t always available to the general public.

Could you qualify for a professional home loan package and what are the benefits?

Who is considered a professional?

Professional home loan packages were once restricted to medical professionals, lawyers and accountants, but now they are available to all sorts of people with sufficient income and assets. Teachers, nurses, defense force personnel, scientists and engineers are among the most widely recognised professions.

Interest rate discounts

People who qualify for a professional home loan package are eligible for a discount of up to 1% p.a. interest on variable rate loans and 0.25% p.a. interest on fixed rate loans. On a loan worth $600,000, a 1% annual rate discount equates to $6,000 annually in interest savings.

LMI waivers

This is where the savings can really add up. Many professionals who work in recognised industries can qualify for waived Lenders Mortgage Insurance (LMI) for up to 85% LVR, instead of the standard 80%. Furthermore, medical, finance, legal and select mining professionals can qualify for waived LMI up to 90% LVR, provided you belong to an industry association, and meet income requirements and certain financial/property criteria as well. Borrowers can save 5 to 10k in LMI costs alone, on a $500,000 property with a mortgage of $450,000.

Reduction of fees

It is becoming more and more common for lenders to waive application fees on professional home loan packages, leading to a saving of $500 to $800. In addition, they offer reduced fees and interest rates when bundling different products like transaction accounts, credit cards and insurance policies together in exchange for your loyalty. This offers you yet another chance to lock in savings of several hundred to several thousand dollars.

More options

Often, professionals who qualify for a professional package get the benefit of flexibility in their home loan. Offset accounts are usually set up to enable borrowers to pay their loan off quicker and redraw when necessary. You may also have the option of making additional payments without penalty.

At Professional Home Loans, we have developed strong relationships with various lenders who have a range of options tailored to professionals. If you’re ready to buy and you want to save money on your home loan, call us today on 1300 55 44 97 to discuss your options.

Overseas buyers: Deposit

How much deposit do overseas buyers need?

Most overseas buyers who are looking to buy real estate in Australia – whether as an Aussie expat, a temporary resident or a foreign citizen – need to save a minimum 20% deposit to purchase property in Australia.

Of course, there are exceptions to every rule, so while a 20% deposit is preferred by most lenders, there are certain financiers in the market who will accept smaller deposits and higher LVRs, depending on the strength of your application.

At Professional Home Loans, we work with these lenders every day to make sure we can source the best value loans on behalf of our customers. We also negotiate hard to try and secure you the best possible rates and conditions. If your situation falls into one of the ‘exception’ categories listed below, you may be in luck.

For Australian expats wanting to buy Australian property, a strong employment history, current stable job, clean credit history and earning a currency that is approved by Australian lenders can help you put forward your case to borrow more than 80% LVR.

For example:

  • Non-resident Australian citizens living overseas can get loans for up to 90%, or even 95%, of the property value.
  • Australian Permanent Residents who are living abroad are eligible for up to 90% LVR.
  • Australian citizens living abroad with a foreign spouse can access up to 90-95% LVR.
  • Australian citizens living abroad with a permanent resident spouse can obtain up to 95% LVR.
  • Australian citizens with dual citizenship may be able to borrow up to 95% LVR.
  • Self-employed Australian citizens living abroad have a more difficult time getting approved for a loan, as they are seen as higher risk, but with sufficient details from an accountant and a strong application, it is possible to borrow up to 90% LVR.

International buyers who want to buy Australian property will face further challenges, because regardless of how much deposit you have or need as an international buyer, you can only purchase certain real estate types.

This is because the specific properties that you are permitted to purchase are governed by the Foreign Investment Review Board (FIRB), the regulating body of Australian investment, so you will therefore need their permission before proceeding with any deal.

Assuming your property is FIRB approved, foreign buyers may be able to access various LVRs as follows:

  • Foreign citizens who live abroad can generally borrow at 80% LVR.
  • Foreign citizens living abroad, but who are married to an Australian citizen, can access up to 95% LVR.
  • New Zealand citizen living in Australia (461 visa) is treated as a permanent resident and eligible for a loan of up to 95% LVR.
  • New Zealand citizen living in New Zealand can borrow up to 95%.
  • New Zealand citizen living elsewhere abroad can access up to 80% LVR.

Foreign citizens living in Australia will require a temporary visa in order to earn an income locally. The conditions of purchasing property when living in Australia on different temporary visas are outlined below:

  • An international student visa is generally restricted to 80% LVR if they purchase with their parents. They can’t really prove income so lenders see them as high risk.
  • 457 visa: up to 90% LVR
  • 487 visa (skilled regional sponsored visa): 90%
  • Self-employed temporary resident (subclass 160, 161, 162, 163, 164 or 165): generally limited to 80% with at least 2 years financials available.
  • Medical Practitioners/Doctors of Medicine: 90% plus they may be excluded from needing to pay Lenders Mortgage Insurance (LMI)
  • Spouse visas (subclass 309/100 and 820/801) – up to 95%
  • Permanent residents – 95%

This can be a tricky process to navigate, so feel free to contact us at Professional Home Loans if you have any questions. You’ll benefit from Craig Vaughan’s position as one of Australia’s top 100 mortgage brokers, meaning you’ll have unrivalled access to Australia’s lenders.

Enquire now for a free, no-obligation phone call to explore your options!

Austrailan Mortgages for an Expat

Can expats get a mortgage in Australia?

If you have plans to take your career in an international direction – or if you are already globetrotting, and wish to dip your toe into the Australian property market – there are plenty of options available to you. Importantly, these are available without you having to put up with uncompetitive interest rates or high deposit amounts.

In fact, by purchasing an investment property back in Australia while you are overseas, you can even benefit from attractive tax benefits*, which makes this prospect even more attractive.

So how does it work from afar?

  • Confirming eligibility
  1. The first step is to confirm your eligibility. Non-resident Australian citizens who live overseas are often eligible for the same loans and financing as those who live locally. Factors that will be taken into consideration include:
  2. The country you are living in and the currency you are earning. Different lenders accept different countries and currencies.
  3. Your income: your income needs to be sufficient to cover mortgage costs and leave a buffer for fluctuating currency exchange.
  4. Job stability: it is looked upon favourably if you have been with the same employer for over two years.
  5. Clean credit: ensure your Australian credit history is clear. Overseas credit isn’t checked, although lenders may ask to see some statements.
  6. Genuine savings and assets: it is important for lenders to see that you can manage money well.
  • Sourcing 
  1. By getting a verified pre-approval through a qualified mortgage broker such as Professional Home Loans, you can be confident that you will have the best chance of finding the right loan for your needs. When you have pre-approval in place to purchase a property in Australia, it’s time to start looking for the right house. Verification generally lasts 3-6 months, allowing you plenty of time to find a property while still overseas. Websites like realestate.com.au or domain.com.au are handy tools to narrow down the choices, then you can work with family and friends or a buyer’s agent to help you make the final decision. Be careful and do your due diligence and consider flying back to personally view the property yourself, if you’re not using the services of a trusted and professional buyer’s agent.
  • Processing 
  1. You don’t need to come back to Australia to manage the paperwork and legal documents involved in purchasing a home. The majority of the process can be completed and shared via fax, phone and internet. Settlement usually takes place 30-45 days after signing your contract. It is often not advised to advertise your status as an expat buyer when you are making an offer on a property, as there are lenders and agents who will use this information to try and take advantage of your situation. This is why it is vitally important to have the right team around you from the very start, to ensure you get the best property for the best rate, best price and least fuss.
  • Maintaining
  1. Once you have settled on a property it is officially yours! It’s time to celebrate, but it’s also time to find tenants and maintain. You can ask trusted family members or friends to help with the maintenance side of it, although our advice is always to choose an investment real estate specialist to take care of it for you.

Whether you are at the dreaming stage, actively researching, or you’re ready to put an offer on a property, Professional Home Loans can help you become an Aussie expat property owner. We have extensive experience working with expats, along with relationships with lenders who won’t shy away from your situation. Contact us for an obligation-free chat on 1300 397 287 or contact us via email.

* Be sure to speak with your accountant to confirm any tax benefits available to you as an expat buyer. We are unable to provide any taxation or accounting advice at this time.

  • Why Choose Professional Home Loans

    Getting a home loan was really simple with Professional Home Loans.

    “We went overseas during settlement and it was not a problem for them, everything went smoothly and I'm writing this from my new home! ”

    - Jack Clancy -Physio – arranged 90% No LMi

    Well done you made it easy with no BS.

    “Couldn't ask for a better job - until next time (although no time soon, moving was awful). ”

    - Accountant, Mick and Vanessa Renton – 90% no LMI Brisbane, QLD.

    No LMI for building home in Sydney as well as 90% LVR no lmi for investment proerpty off the plan in Newcastle.

    “Professional Home Loans has provided us with a very professional service, communicating all the available options to us and in the process he has literally saved us $75k that we would have otherwise paid. They certainly go beyond the call of duty. ”

    - Hamilton (Accountant) & Nyari (Doctor) Sydney, NSW

    Working for QLD Health achieved 90% LVR no LMI at normal rates - From UK. Sunshine Coast, QLD

    “We were able to get a loan at a good rate and avoid paying LMI which saved us several thousand dollars that we can now put towards other things. Very helpful and informative about all aspects of the process, not just the loan, which we really appreciated as it made the whole thing a lot easier for us. ”

    - Craig and Louise (Medical Registrars) Sunshine Coast QLD

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