Have you struggled to meet lending criteria when you applied for a home loan with a bank, and decided to go with a non-conforming loan? You’re not alone – credit agency Moody’s noted that Australia is on the front lines of a resurgence in non-conforming loans being issued. One group of people who may have a ken interest in these loans are those who have recently moved here – even if you can put down a large deposit on a home, a lack of credit history in Australia can hinder your ability to borrow.

But what if my deposit is nearly 50 per cent of the home value?

Even then, lenders usually like to have an idea of one’s ability to repay within Australia – with credit, it is often better to have borrowed and paid back than to actually have never borrowed before. What’s more, if you haven’t worked in Australia for a year, it can be difficult for banks to determine your ability to repay a loan. You can wait this period of time out and apply for a prime mortgage again, or you can apply for a non-conforming loan for faster access to funds and a home.

Are the non-conforming loans safe?

While they may have higher interest rates and slightly different insurance levels, non-conforming loans are still regulated and safe. Under the National Consumer Credit Protection Act, lenders must take the necessary steps to ensure you can repay your loan, and these types of loans are still with the same institutions as regular loans – no need to worry about any collapse. However, you do still need to meet criteria to qualify for a non-conforming loan. If you do not meet them, you may need to reassess your financial situation and apply again after this.

A mortgage broker’s relationship with lenders means they can assess your financial situation and negotiate loan terms with a bank on your behalf, taking in options from hundreds of different sources.

You can contact a Smartline Mortgage Adviser on 13 14 97 for home loan advice. Or complete our call request form and we’ll call you!

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DISCLAIMER: The information contained in this article is correct at the time of publishing and is subject to change. It is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, Smartline recommends that you consider whether it is appropriate for your circumstances. Smartline recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.