No Deposit Home Loans
No deposit home loans and low deposit home loans are designed to assist borrowers who have a good and stable income, but not the necessary deposit to service a traditional home loan. Right now, you may be able to borrow as much as 95% of the value of the property you intend to purchase.
Full no deposit home loans have been withdrawn from the market following the introduction of tougher lending criteria. There are some alternative options that borrowers with no deposit may wish to utilise, including using family equity. You can read more about alternatives to no deposit loans further down the page.
Assess Your Low Deposit Loan Options
To assess your eligibilty for a low deposit home loan, or to talk to a Loan Market mortgage broker about the home finance options that are in your best interest, call us on 13 LOAN (or direct on +61 2 9249 3739) or email us the form on this page and we will contact you within 2 business hours.
Low Deposit Home Loans – 90%-95% Home Loans
Low deposit home loans are a great alternative to the old no deposit home loans, and generally allow you to borrow around 90 – 95 % of the value of the property. Low deposit home loans are particularly useful for first home buyers, especially when used in conjunction with the First Home Owners’ Grant and generous state-based incentives in NT, NSW, QLD, SA, TAS, VIC and WA. Low deposit options exist for people with a deposit of less than 20 per cent, and will often allow you to capitalise Lenders Mortgage Insurance (LMI) on top of the borrowing amount.
Lenders will require proof of a good income before considering you for a low or no deposit home loan, and may apply stricter assessment criteria and higher interest rates to the loan. Your Loan Market mortgage broker knows the assessment criteria you are required to meet and will package your application to best address this.
Low Deposit Home Loans with No Genuine Savings
A recent development in low deposit home loans has seen the return of 95% loans that do not require genuine savings. Your 5% deposit may instead come from a range of approved sources including statutory gifts, grants, tax refunds, sale of assets or an inheritance. There are strict terms and conditions that do apply to these types of home loans so talk to your mortgage broker to determine your eligibility and the suitability of a 95% home loan for your circumstances.
Alternative No Deposit Home Loan Options – Family Equity
Using family equity may be another alternative to a no deposit home loan or a low deposit home loan. If you do not have the deposit and/or genuine savings required, using family equity means you may still be able to secure a home loan. Talk to your mortgage broker about family equity home loans and other options that are available to you.
Loans to Cover Associated Costs
Some lenders may also consider you for a personal loan in addition to a low deposit loan, to allow you to borrow some or all of the additional costs associated with your property purchase, such as stamp duty and conveyancing fees. You will need to discuss this option with your local mortgage broker.
Increase Your Deposit
Whilst a low deposit home loan can be suitable, it’s always a good idea to put together as much of a deposit as you can, to minimise costs and give you more room to negotiate on interest rates. Put together a basic savings plan using the savings calculator to increase your deposit amount.
Secure a Low Deposit Home Loan
To organise finance for your property purchase with a small deposit, or to discuss the home loan that is in your best interest, talk to your local Loan Market mortgage broker, or call us at any time on 13 LOAN or direct on +61 2 9249 3739.
