Know the Cost of St George's No Deposit Home Loan

As the cost of living and property prices continue to rise rapidly, saving for a deposit has become harder than ever. Enter the St George No Deposit Home Loan.

This loan allows you to borrow up to 100% of the value or purchase price of your property and claims to be ideal for those borrowers with a good amount of cash flow but low amount of equity.

When considering a no-deposit home loan, it is important to examine the features and flexibility of the loan, as this type of loan may be subject to tight restrictions.

For example, the St George No Deposit Home Loan offers a redraw facility, which at first glance may seem an attractive feature, perhaps when compared to other loans. On closer examination, however, the redraw facility is available only to customers on a variable rate loan, is subject to the bank's approval and a redraw fee applies to approved redraw applications.

St George also offer the ability to make extra repayments, but then state that with fixed rate loans, there is a limit on the amount made in extra repayments.
Generally, borrowing 100% of the property's value or purchase price (whichever is the lower with the St George No Deposit Loan) may sound like easy money for those without a deposit saved. Remember though, even if you borrow 100% of the value, the costs you will need to cover on top of your mortgage can definitely add up. For example, you will still need to cover stamp duty, taxes, fees, insurance, legal fees and estate agent fees.

The advantages to a no-deposit home loan such as the one offered by St George is that the expense of the loan could be outweighed by the potential benefits if the property market is rising at a strong rate. Before purchasing a property, always take the time to understand the market in the areas you prefer.

Before you apply for a no-deposit home loan, you will also need to ensure you have a clean credit history and can prove a steady income.
Check the fine print when considering a no-deposit home loan. Make sure you compare St George's interest rates with those offered by different lenders, as no deposit loans can carry higher interest rates and fees. No-deposit loans can also be accompanied by limitations on your borrowing requirements, so be sure to find out about the conditions of your loan before making a commitment.

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