Valuation below the contract price? See your options with an indicative assessment within 2 business days.
- Indicative assessment within 2 business days, with settlement typically 1 to 4 weeks depending on the new valuation
- Loans from $100K to $2M to complete the purchase of a home or a residential investment in your own name
- Buyers at auction, first home buyers, upgraders and self-employed buyers whose approved loan no longer reaches the price
- Covers a fresh application with another lender, a larger loan with lenders mortgage insurance, or a loan alongside your own funds
- Full-doc (tax returns), low-doc or alt-doc (BAS, bank statements or an accountant's letter instead) options across our 90+ lender panel
You signed the contract, your loan was approved, and then the lender's valuation came back below the price you agreed to pay. A lender lends against its own valuation, not the contract price, while you are still bound to pay the full price at settlement. Your conveyancer is the first call, because they can tell you where the contract stands and how much time you have. A settlement shortfall home loan is a home loan arranged to cover the purchase after a low valuation, sometimes with another lender or at a higher loan-to-value ratio (LVR), the loan as a share of the property's value. Joseph Farhat and his team can work out the size of the gap and set out each way of meeting it.
Who we can help access finance
- Buyers who won at auction and then had the property valued by their lender at less than the winning bid.
- First home buyers whose deposit was sized for the contract price and does not cover the extra amount the lower valuation leaves to fund.
- Upgraders whose contribution comes from the sale of their previous home and is already fixed.
- Self-employed buyers on a low-doc approval with a lower maximum LVR, which leaves less room when the valuation drops.
- Individuals buying a residential investment property in their own name who are now short at settlement.
How Settlement Shortfall Home Loans Work
Lenders set the maximum loan as an LVR, and the value they use is their own valuation. Take a $900,000 contract with a loan approved at 80%, or $720,000. If the valuation comes back at $850,000, the same 80% is $680,000, and you now have $40,000 more to find before settlement.
There are several ways to meet that gap. Another lender may order its own valuation, and a different valuer may reach a different figure, or the same one. You can borrow at a higher LVR, which usually brings lenders mortgage insurance (LMI). LMI protects the lender if the loan is not repaid. It is usually a one-off cost, payable when the amount borrowed exceeds 80% of the property's value, and it does not benefit you. A larger loan also has to pass the lender's serviceability test, and banks apply a buffer of 3 percentage points above the loan rate, the level APRA confirmed on 28 May 2026. Savings and money from family can cover some or all of the gap. Your conveyancer can also ask the vendor whether a short extension is possible, which is up to the vendor.
Under the standard NSW contract, the default completion date is the 42nd day after the contract date. If the buyer does not complete, the vendor can serve a notice to complete. On a buyer's default, the vendor can end the contract, keep a deposit of up to 10%, and sue for any loss on resale. We are a finance broker, not a lawyer or conveyancer, so contract questions go to them first. Joseph Farhat and his team then compare valuation and LMI policy across 90+ bank, non-bank, and specialist lenders.
What Lenders Assess for Settlement Shortfall Home Loans
The valuation
the lender's own valuer, the comparable sales used, and any notes about the property's condition or location.
The new LVR
how far above 80% the loan now sits, and whether the lender's LMI limits allow it.
Serviceability on the larger loan
your income tested at the loan rate plus the buffer, less living costs and existing debts.
Where the rest of the money comes from
savings history, gifted funds, and any other borrowing, which has to be disclosed.
Time to settlement
how many days remain, and whether a notice to complete has been served.
Your credit file
recent enquiries, including the application already made for this purchase.
The Settlement Shortfall Process: What to Expect
- Speak to your conveyancer about the settlement date, then send us the contract, the valuation result and your current approval.
- We work out the gap at different LVRs, with and without LMI, and how far your savings or family funds go toward it.
- We compare lenders whose valuation, LMI and serviceability policy may fit, and tell you plainly that a new valuation may not come in higher.
- The chosen lender values the property and issues formal approval, with the settlement date in front of every step.
- Your conveyancer and the lender settle the purchase.
Indicative Finance Options
| Lender Type | Pricing | Max LVR | Typical Loan Range | Loan Term | Speed to Settlement |
|---|---|---|---|---|---|
| Bank | Sharpest available pricing | Up to 95% with LMI, for eligible borrowers | $100K to $2M | Up to 30 years | 1 to 4 weeks, depending on the valuation |
| Non-Bank Lenders | Priced for flexibility | Up to 90% with LMI | $100K to $2M | Up to 30 years | 1 to 3 weeks, depending on the valuation |
| Private Finance | Not typically used for home purchases. Available for unique scenarios only. | ||||
Indicative figures only. Actual terms depend on your circumstances, the property, and lender assessment at the time of application. We quote your rate and comparison rate for your specific loan amount and term before you apply. Terms are subject to change.
Why borrowers choose Settled With Joe for a settlement shortfall home loan
We represent you, not the lender
the best interests duty applies to every consumer loan we arrange, including one with a close settlement date.
The gap in dollars
you see the shortfall at each LVR, with the LMI cost shown, before another application is lodged.
Honest about valuations
a second lender's valuer may agree with the first, and we say so before you rely on it.
Non-loan options alongside
your savings, family funds and a possible extension are set out next to any larger loan.
One application at a time
each credit enquiry is recorded on your file, which is why the lender is chosen before anything is lodged.
90+ lenders on one panel
bank, non-bank, and specialist, so well-documented buyers can reach bank pricing and others still have choices.
Private finance for unique scenarios
for unusual cases, we can introduce you to private finance options.
Usually no direct cost to you
as a broker we are typically paid by the lender on settlement.
Frequently asked questions
What is a settlement shortfall home loan?
It is a home loan arranged after the lender's valuation comes in below the contract price, so the approved loan no longer covers settlement. It might be a new application with another lender, a loan at a higher LVR with LMI, or a loan that works alongside your savings or family funds.
Will applying affect my credit score?
Each application for credit shows on your credit file, whether it is approved or not. A cluster of them in a short time can make the next lender wary. After a low valuation, you already have one application on file, so a second needs to go to a lender whose valuation and LMI policy suit the property. We work that out before anything is lodged, which keeps the number of enquiries down.
What is a comparison rate, and why are no rates shown on this page?
A comparison rate combines the interest rate with most standard fees into one figure, so loans can be compared fairly. Because it depends on the loan amount and term, a number on this page would not reflect your new loan size, your LVR or any LMI. We quote the rate and comparison rate for your actual loan, with the LMI cost shown separately, before you apply.
Do you work with borrowers with bad credit?
Yes, we do. A listing such as a default or arrears does not rule you out, and there is nothing awkward about raising it with us. With a shortfall, the questions that weigh most are the new LVR, the valuation and whether the bigger loan fits your income. Some lenders on our panel put more weight on those than on the credit history, pricing the risk instead of declining it. Raise it with us early so the next application goes to a lender likely to accept it. Joseph Farhat and his team will give you an honest read before you apply anywhere.
Do you act in my best interests?
Yes. The best interests duty has applied to credit assistance on consumer loans since 1 January 2021. Where your interests and ours conflict, yours come first. Before suggesting a loan, we make reasonable inquiries into your finances, what you need the loan to do and what you are trying to achieve, and a loan that is unsuitable for you is off the table, however close settlement is. Our Credit Guide comes to you before we provide credit assistance.
Why did the valuation come in below what I paid?
A lender's valuer reports what the property is worth as security for a loan, mostly by looking at recent sales of similar properties nearby. The price you agreed is set between you and the vendor, and at an auction it can be pushed above recent sales. Where prices are rising quickly, or there are few similar sales, the two figures can differ.
Can I get a different valuation from another lender?
You can apply to another lender, and it will usually order its own valuation. That valuation may be higher, the same or lower, and nobody can promise which. A new application is also another enquiry on your credit file, and it takes time against your settlement date. You can ask your current lender whether it will look at the valuation again, for example with recent comparable sales your agent provides.
Can I borrow more with LMI to cover the gap?
Possibly. Many lenders will lend above 80% of the property's value with LMI, which raises your LVR. LMI is a one-off cost that protects the lender, not you, and it grows as the LVR rises. The larger loan must still pass serviceability, including the 3 percentage point buffer banks apply. We show you the LMI cost and the new repayment side by side, so you can compare them with using savings or family funds.
Can my family help with the shortfall?
Yes, and lenders treat each form of help differently. A gift is usually the simplest, and lenders will want to know it is a gift rather than a loan. If a family member offers their own property as extra security, that is a guarantee. They may have to repay the whole loan if you cannot, and their property could be sold. Anyone considering that should get independent legal advice first.
Can I use a personal loan or credit card for the shortfall?
Any other borrowing has to be disclosed to your home loan lender, and its repayments are counted when the lender assesses whether you can afford the home loan. Lender policy on using borrowed money toward a purchase varies. We can set out the total cost of each option before you decide.
What happens if I cannot settle on the due date?
Speak to your conveyancer straight away. Under the standard NSW contract, once the completion date passes the vendor can serve a notice to complete. The contract does not state the notice period, and 14 days is common practice. If the buyer still does not complete, the vendor can end the contract, keep a deposit of up to 10%, and sue for any loss on resale. Your conveyancer can tell you what applies to your contract and state.
Why work with Settled With Joe to arrange your settlement shortfall home loan?
Because one conversation replaces a round of applications, at a time when the deadline is close. Many of the people we help with a shortfall are first home buyers, upgraders, self-employed buyers and individual investors holding a signed contract, a valuation that fell short and a settlement date a few weeks away. That is familiar ground for us, and nobody is judged for it. The deciding points are the new LVR, the valuation and whether your income supports the bigger loan. With 90+ bank, non-bank, and specialist lenders on our panel, a well-documented file can go to a bank at a sharper rate, and buyers with harder-to-document income still have somewhere to go. We are based in Sydney and help buyers across Australia. Joseph Farhat and his team will give you an honest, early answer on what can be done by your date.
Do you give financial advice?
No. We do not guide you on your finances, nor give financial advice. We focus on outcomes and solutions of presenting your unique scenario to the right lender so you can access funding in a timely and compliant manner.
Do you help with settlement shortfall home loans outside Sydney?
Yes. Settled With Joe is based in Sydney and arranges settlement shortfall home loans Australia-wide, covering both metro and regional areas. We work with clients in Sydney, Melbourne, Brisbane, Perth, Adelaide, and Canberra, as well as regional areas including Newcastle, Wollongong, Geelong, Gold Coast, Sunshine Coast, and Toowoomba. Joseph Farhat and his team will match your property and your date to lenders on the panel.
