What Is Owner Finance (also known as Vendor-Finance) ?
Low Deposit Property as the current owner of the house sells the house to you and Low Deposit Property provides you with the finance.
We call this owner-finance as Low Deposit Property is the current owner and the finance is provided by the owner. Legally it is known as vendor-finance as the seller is also known as the vendor.
Can anyone buy a house from Low Deposit Property?
Yes, pretty much. We want to help all people to own their own home. Obviously, we cannot help everyone, but we do try. We are very committed to trying not to put people under financial pressure, so a very important part of qualifying with Low Deposit Property is being able to comfortably afford the payments on your house.
Is Low Deposit Property a bank or financial institution?
Low Deposit Property is not a bank or financial institution. We are a privately owned Australian business that owns houses and sells our houses directly to you.
As such our criteria is much more flexible since we do not follow the same protocol that banks and other institutional lenders have to abide by. In most cases, if you have had a good record of paying rent, and you have a small amount of upfront money, we will be able to help you.
What qualifications do you look for?
We understand that you may have experienced bankruptcy, overdue bills, or other credit challenges in your past. We understand that these things can happen to people and we also believe in properly understanding peoples individual circumstances and giving people a chance.
If you have the necessary upfront deposit, are employed and can prove that you can comfortable afford the payments for the house, without placing you or your family under financial pressure, then you should have a strong chance of qualifying with us for owner-financing.
How soon can we buy a house?
How many houses we have available at any point in time fluctuates. We are always looking for nice houses for our clients. The more flexible your criteria, the sooner you will have the opportunity to buy a home from us.
A big advantage of buying through Low Deposit Property is that once you have located the house you want to buy from us you can move into your home very quickly, normally within 2-3 weeks and maybe even faster!
What is the lowest deposit you accept?
It all depends really. The more deposit you put down the lower your payments will be which enables you a better chance of qualifying for a home. Our deposits are generally significantly less than is required by a bank or financial institution.
Do you finance any applicants on no deposit?
No. All of our clients MUST have money of their own for a deposit.
Can I Use The First Home Owners Grant?
To find out if you are eligible call the State Revenue Office on 132161.
What about repairs and maintenance?
As the owner of the home you pay for any repairs or maintenance to the property.
Who pays insurance and rates and taxes?
As the owner of the home you pay for any insurance and rates and taxes on the property. You also pay the land tax, if any, that Low Deposit Property is liable to pay as a result of owning the property.
Can I make cosmetic or structural changes to the house?
Yes. Provided that you firstly have our written consent you can do whatever you like so long as you comply with all building and council regulations.
What about Stamp Duty?
Depending on which state you are buying in, a big advantage of buying a home from Low Deposit Property can be that there is no stamp duty payable upfront when you move into the property. You can check with a solicitor based on your state of purchase.
Stamp Duty is a tax that is payable when the title is put into your name and with owner-financing from Low Deposit Property this happens at the end of the contract term.
Am I locked in for the full term of the contract?
NO! You dont have to wait the full term to finish paying for your home.
At any time you can simply pay the outstanding balance and the Contract of Sale is complete. There are no restrictions that keep you locked in for the full term. Depending on your own circumstances you may at some point in the future be able to qualify for a traditional bank loan and get the bank to provide the money to pay out your Contract of Sale.
Can I sell the house?
So long as the price you can get for your property allows you to at least pay out the outstanding balance under the Contract of Sale then we will work with you to ensure that the property can be sold in accordance with your plans.
Can I put a tenant in the house?
Yes. However, as the owner of the home you are still responsible for continuing to make the correct repayments on the due dates.
Can interest rates change?
Yes. Interest rates can rise and fall. Depending on each individual property, Low Deposit Property offers an option of either a fixed or variable interest rate for up to the first 5 years of all the properties we sell. If you start with a 5 year fixed rate after that the interest rate may vary if the interest rate on the underlying bank loan varies and this will directly effect the level of your repayments under the contract of sale.
What happens if I pay late?
We always encourage open and honest communication and we will try and work out the problem as a first priority. If the problem can’t be solved and the repayments can’t be met into the future then, just like a bank or financial institution, the house would need to be resold to someone else.
You have an obligation under the contract of sale to make payments on time and there are serious penalties and implications if you do not pay on time.
Low Deposit Property must continue to make repayments on the underlying mortgage even if you fail to pay.
In the event that your payments are not being made and are not kept completely up to date, then under the contract of sale Low Deposit Property has the right to terminate the contract and take back possession of the property. You will have to move out and are liable for all money still payable to us under the contract of sale.
Not making payments on time and breaching the terms of the contract of sale is a very serious matter and you should take extra special care to ensure that you can comfortably afford the payments for your home before you sign the contract.
Can I pay early?
Yes, absolutely you are free to make additional repayments to us at any time.
What standard of houses are you selling?
Low Deposit Property buys high-quality, highly-sought after homes. We sometimes buy properties that are structurally sound but need some work done to them as these are great for people who are handy around the house and who are keen to do some work to their new home.
What kind of houses do you have? Where are they?
We primarily have 3-bedroom houses available but occasionally have 4 bedroom houses as well. Our houses generally range from $250,000 to $450,000. We buy all around Australia in suburbs that people can generally comfortably afford to live.
You let us know what kind of house you want and when we have a house under contract or already in our possession, we will contact you to see the house. If you like it, we will start the paperwork for you to buy the house. It is that simple!
Are there any upfront fees and charges?
There is only 1 upfront fee payable by you. This is a $1,650 Administration and Documentation fee for us to process your application and then get the paperwork drawn up by the lawyers for the purchase of your home.
This fee is payable upfront (and is separate to your initial deposit).
Why are you doing this if it is not to make money?
Low Deposit Property definitely aims to make a profit – and we never try to hide this. Our interest rates may be approximately 1-3% percent higher than what a ‘mainstream’ bank may charge, so we make some money on the difference between the interest we are being charged, and what we charge to our customers. We also have a very strong purchasing power and we always aim to buy houses at a discount and then make a fair profit by offering them to our clients at a fair value given we are providing owner-finance.
What kind of clients do you look for?
We only want people who are serious about buying and owning a house. We want people who will have pride of ownership and be good neighbours. We want people who have a reliable job and income, financially responsible, and have a good tenant history. Having good credit is preferred but not required. We look at every application individually and try to tailor a solution for your own circumstances.
Do I need separate legal advice?
Yes. Before you sign the contract we require you to have independent legal advice so that you are aware of all the terms and conditions under the contract of sale. We want you to be fully aware of your responsibilities under the contract of sale before you buy.
Is the title to the property in my name?
No. The title to the property stays in the name of Low Deposit Property until you have made all your repayments and fulfilled your obligations under the sale contract.
You have what is known as an “equitable interest” in the property as you have entered into a contract with Low Deposit Property to purchase the house, however until you have finished paying for the property the title stays in the vendor’s/seller’s name.
Why is there a mortgage on the house when I buy it from you?
HomeTime Solutions often uses traditional bank finance to purchase the properties that we then offer for sale to you.
The lender that has lent us the money to buy the property usually takes a mortgage on the property.
What happens if the vendor doesn’t make the mortgage repayments?
Low Deposit Property is obligated under the contract of sale with you to make corresponding payments on the mortgage as you make your payments under the contract of sale.
So as long as you are making all your payments to Low Deposit Property on time their should be no reason why the mortgage payments would not be being made by us.
If the title is in your name, can you sell the property?
No. Because we have sold the property to you we can not sell the property to someone else. You also have the opportunity to put a caveat on the title to the property which highlights your interest via the contract of sale and protects your interest.
What happens if you go bankrupt?
Provided that all our tenants and property owners continue to pay on time and deposit the right amount I can see no reason for going bankrupt.
Nevertheless, should my company go into receivership or liquidation then my interest in your property might be sold. If this happens you will simply make repayments to another person.
Where can I find out more about how this program works?
Click on the following links to read more about what we do and read an example of how to buy a home with Low Deposit Property works.
How do I get started?
Contact us by clicking here and we will take you through the steps to buying a home!