Equity Finance Mortgage

The Equity Finance Mortgage is the new product to hit the mortgage market. Making it easier for everyday people to purchase their new home or take the next step to investment.

Benefits of an EFM are:

• Reduce your upfront costs on a new purchase
• Reduce your monthly repayments
  
• Upgrade your house, even if you thought you would never be able to afford it.

An EFM works in with a traditional home loan allowing you to borrow up to 20% of the property’s value. Adding an EFM to make purchasing a home affordable ,with you owning 80% of the property and the EFM lender putting in 20% .

Adding an EFM reduces the repayments required on a traditional home loan by up to 20%

However you are not required to make monthly repayments on the EFM (only if you default). You must agree to share with the EFM lender a proportion of any increase in the value of your property at the time of sale or when the 25 year period expires.

An EFM allows you to move some of the expense of purchasing a property, to later when you eventually sell your home. You now have the opportunity to purchase a property you never thought you could afford with up to 20% more borrowing power with an EFM lender.

Who is eligible for the EFM.

1. Must still have 5% deposit
2. Not require a guarantor
3. Be an individual or be borrowing jointly with one or more other individuals.
4. Secure the EFM with your owner occupied property which must be in an acceptable location.
5. Own a freehold property, or seek to buy a freehold property, in a metropolitan area.
6. Location will play a factor in the final credit decision.

In the future if you wish to purchase a new car, or make renovations on your home, you can still do this with  an increase or the refinancing of  your traditional mortgage. You may even be able to deduct those renovation costs off the EFM. If  the market takes a turn for the worst and you loose money on the sale of your property the EFM lender may also share your loss.

For more information please contact us at info@mortgagebrokers.net.au

Please be advised that you should seek financial and legal advice before you consider this product.