non resident loans

Between needing to pay for your airline flight to Australia, your current housing, and all of the other financial costs associated with packing up and moving to another county, it can be very easy to feel overwhelmed by the small bank account balance that you are left with. 

Although some forms of financing might not yet be available to you in Australia as a non-resident, many options are available to meet your student, personal, and home needs as you get your new home set up in Australia. The following are some of the main questions you are probably concerned about, along with the answers.

Will my credit history affect my getting a loan?

Australian lenders are not allowed to access your credit history from overseas. If you have recently moved to Australia, you will not have built up a credit file yet. However, that doesn’t mean loans will not be accessible to you until then. 

Financial experts at Pronto Finance say that “many of the lenders that approve loans for migrants use other criteria for determining credit risk: assets, visa type, the borrower’s financial situation, and overall ability to pay the loan back. Higher amounts might even be lent to migrants depending on their application’s strength.” 

Something to keep in mind is that your credit history in Australia starts the minute you have debts or funds with a financial institution in Australia. If you obtain bad or negative credit history or apply for too many loans within a short period, that can negatively impact your credit score with Australian lenders. 

If you stay on top of your bills and debts and maintain a good credit history, you will increase your chances substantially to successfully obtain a loan. 

Will I be able to obtain a loan for X amount?

There is never a straightforward answer to this question. 

Certain lenders will provide non-residents with loans, while others will not. The Big Four most likely have options for non-residents.

However, you will probably be required to meet certain eligibility requirements before your loan being approved and to determine how much you are eligible to borrow.

Your eligibility might involve the following:

  • A visa
  • A stable source of income or employment 
  • An Australian bank account
  • An Australian residence
  • Ability to repay your loan before the expiry date of your visa

Also, the lender might charge a higher interest rate on the loan — depending on what your circumstances are and the amount of risk that they assess you to be under. You can check some of the banks offering loans to non-residents to compare them and discuss your options further by directly contacting them to discuss your needs.

Migrant Mortgage: Non-resident Home Loans 

After you arrive in Australia, one of the first things that you will want to secure is a permanent home in the country — especially if you and your family have migrated or are in the country on the indefinite-stay permanent resident visa

When you are preparing to purchase your first house in Australia, one important thing is to research the best area that you want to live in.

While you are looking for a house, consider how close your house needs to be to shops, schools, your workplace, and also how safe the different areas are likely to be for your family. 

If you are planning on living in Australia for a long time, then you may want to check up-and-coming suburbs so that your house purchase can be turned into a sound investment.

Another important consideration is to compare mortgages.

It is very important to compare home loans and shop around to find the best one that suits your needs. A good place to begin doing your research is to engage the services of experts from Credit Capital, who will help find and compare various lenders for your particular needs. 

As a temporary resident, are you eligible to obtain a home loan?

One of the ways that Australia promotes growth is to offer easy homeownership options to migrants, and therefore, does not penalise temporary or permanent residents with rules like higher monthly payments. 

Permanent or temporary residents are given the same interest rates, terms, and features (which include the option to delay mortgage under specific circumstances and offset accounts) that are offered to citizens of Australia.

The same eligibility criteria apply as well, including: 

 Age (to apply for a loan you must be over 18 years old)

  • Sufficient identification
  • Loan security (i.e. the saleability and value of your property) 
  • Sufficient funds for covering fees that are associated with buying property
  • A good credit history in the country of Australia (if available)
  • Proof of existing assets (equity, savings, liabilities)
  • Regular ongoing employment (you are required to be employed and can afford to make repayments on your loan from your income). 

Migrants who have permanent residence 

Usually, migrants with permanent residence (PR) will have an easier time obtaining a home loan when compared to migrants who have temporary residence visas.

Individuals who have valid PR and meet all of the financial requirements are eligible to borrow a higher percentage of the value of a property (90%, on average). The precise amount that you can borrow will vary depending on whether you are living overseas, in Australia, or if you are a resident who has foreign income.

Migrants who have PR are also eligible to obtain the first home owners grant (FHOG) if you meet all of the standard requirements like not previously owning a home, intending to occupy the house within the initial 12 months of settlement, and residing in the property for at least six months. 

Migrants who have temporary residence

Although only select lenders and banks have policies for temporary migrants, there are still plenty of opportunities available for obtaining a home loan. Expect to have extra requirements and certain conditions before a loan is approved though. 

Temporary residents of Australia will qualify in Australia for a home loan if they have one of the following long-term working visas: 495, 487, 475, or 457. 

To apply for these loans, you must prove you have a steady income source and need to contact the Foreign Investment Review Board to obtain special permission.

Some lenders may also ask that you provide proof of overseas bank accounts and liabilities to build a more comprehensive financial profile before your request is approved. 

After meeting these requirements, you can apply for a home loan worth up to 80% of the property’s value plus a 20% deposit for security purposes.

Temporary residents are not eligible for the FHOG or a waiver of stamp duty.  

A few lenders allow students and bridging visa holders who have stable incomes to be eligible to borrow up to 80% of the property’s value. However, in these cases, stricter eligibility rules might apply.

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