Nicola Kelland - Mortgages

The Reserve Bank's has taken steps to try and control the housing market, which has experienced strong growth over the past year. The effect of low interest & low deposit mortgages has certainly fueled the lower end of the market, with many seeing that now is the right time to buy their first home.

With low deposit mortgages, it was a viable option to buy rather than rent. Now with restrictions on the number of low deposit loans the banks can finance many future homeowners are wondering how they will be able to buy.

So what are some of the avenues you could consider? Firstly, don’t give up on your bank, try them first and see what their reaction is. High loan-to-value ratio (LVR) loans haven't dried up altogether. Applying through the normal channels should be the first step.

Can your family help with a loan to make up the balance of your deposit? If not are they happy to give up some of the equity they have in their own home, and become a guarantor for the portion of the loan that is required to make up the balance of the deposit.

Do you qualify for The Welcome Home Loan scheme? The Government has tripled the scheme's funding and increased its house price caps.

Banks are not the only companies that lend money, talk to your lawyer or other financial institutions who are not effected by the reserve bank restrictions.  Generally the interest rates are higher and terms are shorter.

You might need to look outside the box to see how you can secure your new home, or work hard to save some more money or your deposit.