When it comes to finance for buying or building a house, it can be stressful trying to save the necessary deposit. For instance, how can you save 20% when you have weekly rent repayments? That’s why Keystart loans were designed- to help people get into their new homes sooner by having lower entry costs. Keystart is a name many Australian’s have heard of, but not many people may know what they do. Because of this, Move Homes has created a breakdown to give you all the facts about them!
In a nutshell, Keystart offers people low deposit home loans. Meaning instead of the traditional 5% to 20% minimum deposit, the deposit can be as little as 2%. They don’t have Lender’s Mortgage Insurance or any monthly account fees, so it is cheaper and easier for people who have tight financial situations. They are also a traditional lender, meaning they encourage people to refinance with another lender when they are ready to do so.
Many people believe that Keystart are a government agency. However, this is not the case as they are a private organisation. Their home loan process is quite simple. But, in order to first be eligible to receive a loan you must meet the minimum requirements – which have been placed below. You can also fill out a quick 5 minute questionnaire on their website to see if you meet the requirements.
• Must be an Australian Citizen or permanent resident.
• At least 18 years of age.
• Be living in Western Australia and wanting to buy or build here.
• Have an income within their maximum limits.
• Not own another home or land at the time of settlement of your Keystart loan.
• Plan to live in your home for the duration of your loan with Keystart (so you can’t rent it out).
• Have enough funds available to cover all costs associated with the purchase, for instance your deposit, fees and any moving costs.
Once you have qualified for a loan, you will find out how much you can borrow. It usually takes between 20 to 30 minutes on their website or over the phone, and Keystart will go over your application and contact you if they require anymore documentation once it’s complete. As soon as you have pre-approval, you’re able to make offers on properties within the pre-approval amount.
Here is when you have made a successful offer and all conditions are met. Your loan documents are sent to you to review, sign and return to Keystart. These documents formalise the contract between you and Keystart. It’s important you take the time to read these documents carefully.
Settlement is the official process of transferring ownership from the seller to the buyer (so putting the property into your name). You will be sent the required documents and told the amount of funds you’ll need to make. You’ll also need to arrange building insurance on your home, and send confirmation before your settlement date. Once settlement has occurred you’ll be allowed to move into your new home or start building your new home.
Keystart aim to support their customers during their home loan journey. For example, during the first 12 months they will regularly check in and see how you’re going. Plus, you can also track and manage all your loan details on the Client Portal on their website.
Keystart have helped over 100,000 Perth families in 30 years, so there’s plenty of questions people have asked! We listed some common FAQs, but if your question isn’t below send us an email we’ll get back to you!
The income thresholds for Keystart were temporarily increased until the 31st June 2021. So if you earn less than the below, you’ve ticked the first box!
You sure can! Many home buyers in Perth are using Keystart to receive both the $25,000 HomeBuilder and $20,000 Building Bonus Scheme. Please note that because of the increase in Keystart applications, the approval process is taking a little longer, so don’t wait until December to talk to us because you might miss out on the grants!
Yes, you can still build a new home through Keystart but if Centrelink is your only source of income, you are unlikely to be approved for a home loan. We’ve helped clients who are receiving Centrelink payments and working part time, so if you’re in a similar position get in touch and we can discuss your individual set of circumstances.
Some of our clients have gone direct, but most get their mortgage broker or bank to deal with Keystart on their behalf. This can help speed up the application process (and gives less stress to the home buyers!).
Yes, when the time is right! Keystart is great for families with low deposits because their loans have low entry costs and there’s no Lender’s Mortgage Insurance. When a Keystart client has built up enough equity in their home, they’re encouraged to refinance so they can lock in a cheaper interest rate.
Yes, Keystart can deny your loan even if you are pre-approved. This can be due to insufficient documentation or if you’ve had a change in circumstances and will be unable to meet the repayements.
Find out if you qualify for Keystart without leaving your couch (or wherever you currently are!).
Over the last 50 years we have proudly built over 15,000 homes for Australian families. We have the same values today as we did in 1969 when we built our first home in Light Street Dianella.
Our commitment is to provide you with complete transparency and give you a real understanding of all aspects of your home loan.