Saving up for your deposit can be daunting, whether you’re a first home buyer in Australia or a seasoned property pro. With the average home deposit being 20% of the property's value, this can be a major challenge - this amount sits well over six figures, and it keeps growing as property prices rise.
Don’t say goodbye to your dream home just yet!
There are paths to homeownership with home loans for low deposit holders, and even no deposit loans. You could have your foot on the property ladder in no time.
So how exactly can you buy a property with no deposit?
What are my loan options if I have no deposit?
There is actually more than one way to get into the property market, depending on whether you have any upfront deposit or no deposit whatsoever.
OwnHome Deposit Boost Loan
With an OwnHome Deposit Boost Loan, all you need is the Low Deposit Premium upfront (up to 2.2% of the purchase price, minimum $9,500), and we’ll cover the rest of your 20% deposit - so you don’t pay LMI! Here's how it works:
For a Low Deposit Premium of up to 2.2% of the purchase price (minimum $9,500), we’ll cover the deposit you need to unlock your very own 80% LVR mortgage.
1. Your OwnHome Deposit Boost Loan is paired with an 80% LVR home loan.
2. When you pay your Low Deposit Premium upfront, our qualified team of home-buying experts will help you every step of the way—from search to settlement.
3. You repay your OwnHome Deposit Boost Loan over time, just like you would with your mortgage. Think of it as paying for your deposit while you live in your home.
Interested in buying a home without a 20% deposit? Use our buying power calculator to see how much you could afford with an OwnHome Deposit Boost Loan.
No deposit home loans
- Guarantor home loan:A home loan where a loved one or family member acts as a guarantor, offering home equity as security for your loan.
- Gifted deposit:A home loan where a loved one or family member pays the deposit upfront as a gift, also known as "the bank of mum and dad".
Low-deposit home loans
- 5% deposit home loans and 10% deposit home loans: A low-deposit home loan may be offered by certain lenders, allowing you to borrow 90-95% of the property’s value. Look for loans with a low minimum deposit or a high loan-to-value ratio (LVR).
There are other pathways for boosting your deposit, as well. You may be able to use the First Home Super Saver scheme to save part of your deposit through voluntary super contributions. Alternatively, you may be eligible for the First Home Owner Grant (FHOG). Each state has their own variation on a first-home buyers scheme, so this is definitely worth looking into if you are a first-time buyer.
Lenders Mortgage Insurance (LMI)
If you are looking to take out a low-deposit home loan, it’s important to remember lenders mortgage insurance. This is a one-off fee paid by the borrower to protect the lender in case they cannot recover the loan amount.
LMI is usually required if you take out a loan with a higher LVR than 80% and can be extremely costly.
What is a guarantor home loan?
A guarantor home loan is a common no-deposit option because it involves someone else (usually a family member) using their equity to secure you a loan. It is possible for them to pledge a full 20% deposit, which will qualify you for most standard home loans with 80% LVR.
Alternatively, you can contribute a smaller deposit - 5%, for example - and your guarantor can top up the remainder in equity to meet a 20% deposit.
This means that you also won’t have to pay (or can minimise) lenders mortgage insurance since you’ll be paying over the minimum deposit.
Rather than lending you money, a guarantor is contributing to your deposit via equity in their home as security. They take on liability if you default on your monthly repayments.
How much can I borrow with a guarantor home loan?
Some lenders let you borrow up to 105% or 110% of the property price with a guarantor home loan. This means you can potentially have enough to cover not just the purchase price but also other initial costs like stamp duty or conveyancing.
Although you are able to borrow that much, not all applicants will choose to. The more you borrow, the more interest you will pay over the life of the loan.
How do I get approved for a guarantor home loan?
While individual eligibility criteria may vary, there are some things that will help you get approved for a guarantor home loan.
- Stable employment: A lender will want to know that you can make repayments, and for that, they’ll want to see that you have an income and stable employment.
- Good credit score: Providers will want to see that you have a strong credit history, from any personal loans to timely credit card payments. Getting your credit score into the best shape possible will make you more attractive from a lender’s perspective.
- Guarantor equity: Your lender will be checking to make sure that your guarantor has sufficient equity in their homes.
What is a gifted deposit?
It probably doesn’t get much better than the gift of a deposit on a new home! If a loved one or family member fronts up your deposit, that is referred to as a “gifted deposit”. This can form either the whole deposit or a part of it and can allow you to apply for a home loan with a lower loan-to-value ratio.
Many first home buyers get help from family, so a gifted deposit will come as no surprise to a lender.
Are there any catches with a gifted deposit?
When you are using gifted contributions to purchase a property, there are some things to remember.
- You may need to prove that the money was received as a gift. This is to stop people from using borrowed money as their deposit, like taking out a personal loan or withdrawing from a credit card.
- You may need to show evidence of genuine savings. “Genuine savings” refers to money that you have personally saved up over time. If you are using gifted money to put down a deposit, your lender will want evidence that you are capable of making repayments with your own money.
- Your credit score will still be checked - so if you have a history of defaulting on loan repayments, a generous gift might not be enough to get you over the line. A strong repayment history will put you in the best position for your home loan application.
If the gifted deposit does not meet the 20% recommended deposit, you may also have to factor in lender’s mortgage insurance.
What is a low deposit home loan?
If you do have some savings to contribute towards your deposit, there are also low-deposit home loan options available. Many lenders have options that allow you to start with a deposit between 5-15% of the property’s value, as opposed to the standard 20%.
Doing this will require you to borrow more money and choose a home loan with a higher LVR, which may also mean higher interest rates or stricter lending criteria.
Are there any catches to a low deposit home loan?
Keep in mind that while a low-deposit loan might be easier to afford now, higher interest rates will be reflected in your monthly repayments over the life of the loan.
You will also be required to pay lender’s mortgage insurance (LMI) based on the higher risk factor presented to a lender.
Due to this heightened risk factor, the application process is also more likely to be lengthy and require much more supporting documentation. Be prepared to do a bit more work than you might have with a larger deposit!
What help can I get as a first home buyer?
If this is your first time in the property market, there are schemes in place throughout Australia to help make real estate a more attainable goal. You may see any of the following terms used as shorthand, all of which represent assistance for first home buyers in Australia:
- First Home Owner Grant (FHOG) - NSW, VIC, QLD, SA, TAS, WA. The ACT has no grant (it has a stamp duty concession scheme) and the NT has the HomeGrown Territory Grant.
- Australian Government 5% Deposit Scheme (formerly the First Home Guarantee)
You may also see mention of the First Home Super Saver (FHSS) scheme, but this refers specifically to voluntary superannuation contributions made which you can request withdrawal of in order to buy your first home.
How much is a First Home Owner Grant?
Different states have different regulations surrounding their first home owner grants (FHOG). In most states it is between $10,000 and $30,000 for first-time buyers. The NT offers a $50,000 HomeGrown Territory Grant for new homes instead, and the ACT has no FHOG.
In NSW, for example, the $10,000 FHOG may be used by first-time buyers who buy a new home (valued at up to $600,000) or buy land and build a new home (combined value up to $750,000).
These grants are generally to be used for owner occupiers only and are not valid for investment property purchases.
Am I eligible for a First Home Owner Grant?
Like the FHOG itself, eligibility criteria are different from state to state. In general, though, eligibility will require that you are:
- Aged 18 or over
- A citizen or permanent resident of Australia
- Have never previously owned property in Australia
- Intend to live in this property for 6 months or more
Some states may also have requirements regarding the property you are purchasing. This may mean that it has to be new or significantly renovated, or that it must not exceed a certain property value.
What is the 5% Deposit Scheme and am I eligible?
The Australian Government 5% Deposit Scheme helps eligible first home buyers buy with a low-deposit home loan. Places are uncapped and there are no income caps.
Keep in mind that to qualify you will need at least a 5% deposit (while the government fronts the remainder of the deposit). You will not need to pay LMI in this instance.
There is other eligibility criteria, including:
- Aged 18 and over
- First home buyers, or people who have not owned property in Australia in the last 10 years (if applying as a couple, both must meet this)
- Intending to be owner-occupiers
There are also price caps for different capital cities and areas in Australia, so make sure to check before you go planning.
Are there any other forms of low-deposit home loans?
We’ve covered most of the major options if you’ve got no deposit or a low deposit, but there are a couple of other schemes in place worth looking at for very specific scenarios.
Both of these are now covered by the 5% Deposit Scheme.
What is the Single Parent Stream and am I eligible?
Designed to help get single parents into housing, the 5% Deposit Scheme's Single Parent Stream (formerly the Family Home Guarantee) offers you the ability to secure housing with one of the lowest deposits possible.
Places are uncapped, there are no income caps, and you don't need to be a first home buyer.
It requires a minimum 2% deposit with the remainder of the deposit guaranteed by the government and no LMI payable, on any residential property. Price caps do apply, as well as the following eligibility criteria:
- Applicants are single
- Applicants have at least one dependent child
- Applicants do not currently own an existing property or home
What happened to the Regional Guarantee?
The Regional First Home Buyer Guarantee is no longer a separate scheme. Since 1 October 2025, regional buyers use the 5% Deposit Scheme, with property price caps set for regional areas.
Should I save up for a bigger deposit?
You’ve done your research and thoroughly scoped out the options available to you with no deposit available. You’ve taken note of ways to scrounge up that little bit extra for a low-deposit home loan to get you to the next level.
Why would you ever save up a 20% deposit?
The more money you put up now, the closer you are to owning your own home. The more money that you borrow, the more interest that you will pay, and the more likely you are to feel the impact of that in your monthly repayments.
The less debt you carry, the less likely you are to find nasty marks on your credit history. The better it looks on future applications, such as if you find yourself looking to refinance.
There are other costs to remember with your home loan, beyond the deposit and application fees. Depending on whether you opt for a fixed-rate or a variable-rate loan, your monthly repayments could be set to change over the life of the loan. You may also be paying an introductory rate that will expire (this is why it is always wise to check the given comparison rate for a more realistic view of the interest rate you will be paying).
It is also worth looking at the difference between interest-only home loans, and principal and interest loans. An interest-only loan may have reduced repayments for a set period of time. At some point over the life of the loan you might want to consider refinancing, which could completely change the loan conditions and home loan repayments.
While the temptation may be there to go for the low deposit home loan route, it may work out easier over the life of the loan to take that bit of extra time now - be it in saving up, applying for grants (like the FHOG), or seeing if any gifts are coming your way.
FAQs
If you have no deposit, you may be more limited in home loan options.
Guarantor loans allow a loved one or family member to use the equity in their property for you to borrow against. Guarantor loans allow you to borrow a greater amount of money — up to 110% of the value of the property. This can be helpful when it comes to upfront costs like stamp duty.
Another option for those with generous friends and family can come in the form of a gifted deposit. This can either stand alone as your house deposit or can top up any deposit that you have already.
If you do receive a gifted deposit, be prepared to demonstrate genuine savings and a strong credit history as a way of proving you will be able to make your monthly repayments. You may also need to prove that the money was gifted in the application process (to prevent people from using money from personal loans or credit cards as their deposits)!
In general, you’ll get low interest rates on low LVR loans. But, it really depends on the type of home loan you select, and the kinds of additional services you require (such as an offset, redraw, fixed or variable rate). But there are definitely instances where you could get competitive interest rates (like with guarantor home loans which you can learn more about here).
Yes, first home buyers can use superannuation to pay for some of the house deposit.
It comes under the first home super saver (FHSS) scheme.
The first home loan deposit scheme, now called the Australian Government 5% Deposit Scheme, lets first home buyers buy a property with as little as a 5% deposit (no LMI needed).
What happens is that the government guarantees the remaining 15% of the usual 20% deposit that lenders need to be able to approve a loan without LMI. Since 1 October 2025, places are uncapped and there are no income caps, but property price caps apply.
