For many Australians, saving for a large home loan deposit can be a major hurdle to buying a home. A low-deposit home loan is designed for those who want to enter the property market without waiting years to save a 20% deposit.

This type of loan is ideal for:

• First-home buyers who don’t have a large deposit but have stable income.
• Home buyers who want to secure a property before prices rise further.
• Investors looking to leverage their funds while maintaining cash flow.

With options to borrow up to 95% of the property value – and even 100% with a guarantor – a low-deposit home loan can be a smart way to buy a home with less upfront capital. Let’s explore how it works, who qualifies, and how you can apply.

What Is A Low-Deposit Home Loan?

A low-deposit home loan allows homebuyers to purchase a property with a deposit smaller than the traditional 20%, typically starting from 5% with most lenders but as low as 2% through government-backed schemes. This can make it easier for people to enter the property market sooner.

How Do Low-Deposit Loans Work?

Low-deposit home loans allow individuals to purchase property with a smaller initial deposit than the standard 20% of the property’s value.

This is particularly helpful for first-home buyers or those struggling to save a large deposit due to living expenses.

While these loans make entering the property market more accessible, the borrowers are required to pay Lenders Mortgage Insurance (LMI) – a one-off payment that protects the lender against financial loss if the borrower defaults on the loan.

While a minimum 2%-5% deposit can help you get started, please remember that additional funds will be needed to cover costs like stamp duty, legal fees, and Lenders Mortgage Insurance.

Why Choose A Low Deposit Home Loan?

Saving a 20% deposit can take years. With a low-deposit home loan, you could buy your first home, upgrade, or invest sooner than you think even with as little as a 2% deposit.

Our expert mortgage brokers help customers who:

• Are first-home buyers with limited savings

• Want to beat rising property prices

• Need guidance navigating government schemes

• Are self-employed or have unique financial situations

You don’t have to wait years to buy. Let’s make it happen now (link enquiry form).

Government Schemes That Help You Buy Sooner

You may qualify for one of the following schemes:

• First Home Guarantee: Buy with just 5% deposit and no LMI
• Regional First Home Guarantee: For eligible regional buyers
• Family Home Guarantee: Single parents can buy with as little as 2% deposit
• Help to Buy Scheme: Government shares up to 40% of the home price (pending launch)

Pros And Cons – Is a Low-Deposit Loan Right for You?

Pros

• Buy Sooner with Less Savings

• Access competitive interest rates

• Break free from renting

• Potentially benefit from rising property prices

Cons

• May need to pay LMI

• Lower Equity = higher financial risk if prices fall

• Lenders may assess your financials more strictly

Do You Qualify?

We’ve helped thousands of Australians get approved, even when they thought they didn’t qualify.

You may be eligible if:

• You have stable income and employment

• Your credit score is solid (no defaults or late payments)

• You’ve saved at least 5% over the past 3+ months

• Your debts are manageable, and your financials align with your age/income
• The property meets lender criteria

Ready To Buy With a Smaller Deposit?

Don’t let a 20% deposit stand in your way. Whether you’re a first-home buyer or investor, our brokers will find the right loan for you and support you through the entire process.

Call 1300 889 743 or complete our online enquiry form to get a mortgage for a low deposit loan.