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WESTPAC CHANGE LVR
Tuesday, January 19, 2010
Westpac have again led the market this time changing their maximum Loan to Valuation Ratios (LVR). The LVR is calculated by dividing the total amount of the loan by the appraised value of the property. What this means is now borrowers must have a bigger deposit.
Before the Change - A Lo Doc Loan
A Borrower purchasing a property for $300000 would need to have 18% deposit or $54000, plus the client would have to cover fees and the Lenders Mortgage Insurance premium (LMI).
They now need to have 20% of the purchase price plus fees and LMI premium that is $60000.
Full Doc Loans Before Change
A Borrower purchasing a property for $300,000 previously needed 8% deposit plus fees and LMI or $24000.
Now to borrow $300,000 a client will need to have a min deposit of 13% of the purchase price or $39000
- Homehound.com.au
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