Lender review
Is Skip a good lender for buyers with a small deposit?
The short answer
A non-bank built for buyers with a small deposit who want to avoid mortgage insurance. Skip splits one loan into two on the same property and charges a capitalised fee in place of insurance. The trade-offs are a narrow product, strict property and postcode rules, and no fixed rate, offset, interest only or alt-doc options.
How we rate them
Our assessment, not a lender claim. Five dimensions, scored out of five, revisited when the policy-checked date changes. Rate & fees is judged on the pricing borrowers actually transact at; Skip replaces mortgage insurance with a capitalised fee, which we weigh against a real insurance quote.
- Rate & fees competitiveness
- 3.5/5
- Approval speed
- 3.5/5
- Technology & apps
- 3/5
- Product & policy flexibility
- 2.5/5
- Service
- 3.5/5
Skip offers two pricing options per loan, a lower rate with a higher upfront fee or a slightly higher rate with a lower fee. The upfront fee replaces mortgage insurance and is added to the loan. Skip says it is always lower than insurance, and we test that on each file.
Can I get a loan with them?
Yes, if you are an individual borrower on a full-doc income, buying or refinancing a standard home in an accepted postcode, with genuine savings behind you. Companies, trusts and guarantors are out.
Skip writes one product, the Skip Home Loan, for owner-occupiers and investors. It is split into a first-mortgage Primary loan and a Secondary loan covering the rest, with one rate and one term across both, and the two are assessed together. Borrowers must be natural persons, and the lender expects genuine savings from the applicant, with some exceptions when saving ability can be shown. Investors can hold at most one existing mortgaged property, which must be owner-occupied. Property must be a residential dwelling in an accepted postcode, with extra limits on outer metro areas and on apartments, particularly in high-density postcodes.
What they will and will not do
Facts from the lender's current policy, not judgements.
- Yes: No lenders mortgage insurance
- Yes: Investment loans
- Yes: Debt consolidation
- Yes: Cash-out refinance
- Yes: Redraw (on the Primary loan)
- No: Construction loans
- No: Interest only
- No: Fixed rates
- No: Offset account
- No: Alt-doc income
- No: Trust or company borrowers
- No: Vacant land
Pros and cons
What works
- High gearing without mortgage insurance: Skip lends to a small deposit by splitting the loan and charging a capitalised fee instead of insurance.
- The lender says that fee is always lower than an equivalent insurance premium, which is checkable on each file.
- Pre-approvals are fully assessed and, per the lender, honoured even if its assessment rate later changes.
- Debt consolidation is allowed alongside a purchase or refinance, within limits.
- Free extra repayments on the Secondary loan and redraw on the Primary.
What doesn't
- Principal and interest and variable rate only, with no offset, no interest only and no fixed rate.
- Full-doc only: no alt-doc or low-doc lending, and self-employed income is limited to sole traders with two years in the same business.
- Natural persons only; no companies, trusts or guarantors.
- Tight security rules: accepted postcodes only, outer metro limits, apartment height and size limits, and no vacant land or construction.
- Casual income is treated cautiously, and some of the lender's documents disagree about it.
What are they distinctly good at?
Getting into a home sooner with a small deposit and no mortgage insurance, for a clean, full-doc, standard-property file.
Skip is a Connective-branded range provided by Skip Loans. The product is deliberately narrow, which is the price of its structure: two loans, one security, one rate. It sits between standard bank policy, which asks for insurance at high gearing, and government deposit schemes with their own caps and place limits. Whether it beats those routes depends on the actual fee, the property and the borrower, which we work out per file.
Who it suits, and who it does not
A good fit if
- First home buyers and upgraders with a small deposit and a stable PAYG income.
- Borrowers who want to avoid mortgage insurance on a standard property.
- Refinancers consolidating a few debts into one loan.
Look elsewhere if
- Anyone who wants a fixed rate, an offset account or interest only.
- Company, trust and guarantor-supported borrowers.
- Self-employed borrowers without full tax returns, or casual workers relying on that income alone.
- Buyers of apartments in high-density postcodes, outer-metro units, vacant land or a build.
Our verdict
A specialist answer to a specific problem: a small deposit and no appetite for mortgage insurance. The split structure does that job, and the lender backs it with fully assessed pre-approvals. It is not a general-purpose lender, and the conditions are tight on borrower type, property type and location. For the right file it is a serious option, and we compare the capitalised fee against a real insurance quote and against the lenders we can arrange who accept a small deposit with insurance. A few points in the lender's own documents conflict, such as loan size limits, so those are checked on each deal.
We can arrange loans with this lender, through Connective Skip, the Connective-branded range provided by Skip Loans.
Comparable lenders
Lenders that solve a similar problem, and that we can arrange.
Lender assessments are our own opinion, based on the policy and product terms in force on the policy-checked date shown above, and are not a recommendation.
Not sure whether this is the right lender for you?
Fifteen minutes, no obligation. Or check where your current rate sits first.