Loan-to-Value Ratio: How It Affects Studio Apartment Loans

When applying for a studio apartment loan, the loan-to-value ratio (LVR) determines how much you can borrow. For apartments under 25 square metres, an LVR of 60% is standard, meaning you’ll need to cover 40% of the property’s value with your deposit. However, with lender’s mortgage insurance (LMI), some buyers can increase their LVR to 80%.

For slightly larger apartments, between 25 and 35 square metres, an LVR of 70% becomes available. This provides greater flexibility and accessibility for borrowers. Again, if LMI is applied, the LVR can be raised to 80%, which helps more buyers finance these smaller homes.

For studio apartments 35 square metres or larger, the LVR can reach as high as 95%, especially for first-time buyers under the First Home Buyers Guarantee (FHBG) scheme. This option allows buyers to secure affordable mortgages with minimal upfront costs.

Disclaimer: The content provided is for informational purposes only and is not financial advice. Please consult a professional advisor to discuss your specific situation.