Low Deposit Home Loans
Low Deposit Home Loans Australia: Compare 60+ Lenders and Buy With as Little as 5% Down
We’ll help you get into the market sooner, because saving a full 20 percent deposit shouldn’t be the only way in.
Lodestar Finance compares low deposit home loans Australia wide from 60+ lenders, including government guarantee schemes, guarantor options, and lenders who offer sharper rates at a higher loan to value ratio.
Lodestar Finance Pty Ltd · Credit Representative (CRN 571879) of Purple Circle FS · Australian Credit Licence 486112 · 60+ Lenders Compared
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How Low Deposit Home Loans Work in Australia
Low deposit lending is common, but every lender assesses it a little differently. Here is what typically matters:
Your Deposit Size
Most lenders set 20 percent as the standard, but many will lend at 90 or even 95 percent of the property's value. Your exact deposit size shapes which lenders and schemes are available to you.
Lenders Mortgage Insurance (LMI)
Borrowing above 80 percent of the property's value generally means paying LMI, unless you qualify for a government guarantee scheme or another exemption.
Government Guarantee Eligibility
Schemes like the Home Guarantee Scheme have income, property price, and citizenship requirements. We check what you qualify for before recommending a lender.
Your Income and Serviceability
A smaller deposit does not automatically mean a smaller loan. Lenders still assess your income, expenses, and existing debts the same way they would for any home loan.
Our Lenders
Why a Broker, Not Just a Bank
Since 2021, brokers in Australia are legally required to act in your best interests when recommending credit, a legal obligation known as the Best Interests Duty. Banks have no equivalent obligation, they only have to offer you their own products.
With access to 60+ lenders, we can compare low deposit options side by side, including which lenders offer the sharpest rates at a 90 or 95 percent loan to value ratio, and which government schemes you may be eligible for.
Who's Eligible for a Low Deposit Home Loan?
- Saving a deposit of 5 percent to 10 percent of the property’s value
- Be an Australian citizen or permanent resident
- Show proof of income such as payslips, tax returns, or bank statements
- Have a reasonable credit history with no unresolved defaults
- Meet the income and property price caps if applying under a government guarantee scheme
- Have a guarantor available, if using a guarantor loan to reduce or avoid LMI
What Can You Use a Low Deposit Home Loan For?
Low deposit home loans are most commonly used to purchase an owner occupied first home, but they can also apply to upgrading to a larger property, buying under the Regional First Home Buyer Guarantee, or purchasing off the plan. Lodestar Finance will confirm which scheme or lender policy fits your situation before recommending a lender.
CALCULATORS
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With Lodestar Finance
You don’t have to figure it out alone! We'll help you with:
Check Your Eligibility
We check which schemes and lender policies you qualify for, including income caps, property price limits, and location requirements.
Compare the Market
Not every lender treats low deposit applications the same way. We compare across our panel and connect you with the ones that actually suit your situation.
Handle the Paperwork
Applications, LMI quotes, scheme paperwork, we manage the details so you are not chasing lenders or government portals on your own.
Guide You to Settlement
From the first chat to the day your loan settles, you will have real experts explaining your options in plain language.
Testimonials
Amazing Reviews From Our Clients
Jake Wilson
Went through Lodestar Finance for my home loan and it was honestly a really good experience. No pressure, no confusion. They just explained things properly and got it done. Would use them again.
Lauren McKay
I was expecting the whole loan process to be a headache, but it wasn’t. Lovepreet handled most of it and kept checking in so I knew where things were at. Made life a lot easier.
Tom Reynolds
Everything was pretty straightforward and communication was solid the whole way through. Saved me money too, so no complaints.
Gurpreet Singh
As a first home buyer I had no idea what I was doing. The team at Lodestar were patient and answered all my questions without making me feel silly. Really appreciate that.
Chloe Bennett
Really easy to deal with and super responsive. If I had a question, they got back to me quickly. Didn’t feel stressed at any point, which says a lot.
Rohan Patel
The process was smooth from start to finish. Nothing dragged on and everything was explained clearly. Overall just a solid, reliable experience.
Low Deposit Loan Types You Can Choose From
5% Deposit Home Loan
Buy with a 95 percent loan to value ratio through select lenders.
Home Guarantee Scheme Loan
Buy with as little as 5 percent deposit without paying LMI, if you're eligible.
Family Home Guarantee
Single parents or legal guardians may qualify for a deposit as low as 2 percent.
Guarantor Home Loan
Use a family member's property as additional security to reduce or avoid LMI.
Professional Package Loan
Certain professions may qualify for an LMI waiver even with a smaller deposit.
10% Deposit Home Loan
A common middle ground with more lender choice and a lower LMI premium than a 5 percent deposit.
FAQs
Frequently Asked Questions
Yes, most lenders will consider a 5 percent deposit, generally through a government guarantee scheme or with Lenders Mortgage Insurance applied.
LMI protects the lender, not you, if you default on the loan. It generally applies once your loan to value ratio goes above 80 percent, though you may avoid it through a guarantee scheme, a guarantor loan, or a professional waiver.
It's a federal government initiative that lets eligible buyers purchase with a low deposit without paying LMI, because Housing Australia guarantees a portion of the loan to the lender.
Not necessarily. Your rate is based on your overall financial position, not just your deposit size. We compare lenders to find a competitive rate regardless of your loan to value ratio.
It depends on your circumstances. A guarantor loan can help you avoid LMI entirely, but it places risk on the guarantor. We'll walk you through both paths so you can choose what suits your situation.
Most low deposit loans require a minimum of 5 percent, though your upfront costs should also account for stamp duty, LMI if applicable, and settlement fees. We can model this for you before you start house hunting.
Yes, though most government guarantee schemes are restricted to owner occupiers. A guarantor loan or standard low deposit lending may still apply to an investment purchase, depending on the lender.
Banks only show their own products, and only have to offer what is in their own range. As a broker, we are legally required under the Best Interests Duty to prioritise your interests, we compare many lenders, explain the fine print, and manage the process end to end.
This page is general in nature and does not take into account your personal objectives, financial situation, or needs. Lodestar Finance Pty Ltd is a Credit Representative (CRN 571879) of Purple Circle Financial Services Pty Ltd, Australian Credit Licence 486112.
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