Can I get a home loan without a deposit?

A guide to buying houses

Where do I start when buying property?

Buying property is probably one of the biggest financial decisions you’ll make in your lifetime. As such, it requires a large amount of consideration. It doesn’t matter if you’re buying a six bedroom house on Wolseley Road – or a studio apartment in Tuggeranong, buying property is a very big deal.

Where to start? As a first step, it’s a good idea to work out what your budget is – based on your deposit and how much you can borrow. Luckily, uno has a borrowing power calculator that helps you work out how much you’re working with. We also have a section which details everything you need to know about your
so be sure to check that out too.

Securing pre-approval for your expected maximum loan amount will then help you negotiate the best purchase price when it comes time to buy. Once you know your budget, you can begin that exciting home search.

Steps to buying a home:

  • Step 1: Budget
  • Step 2: Apply for a home loan & get pre-approval
  • Step 3: Find a home
  • Step 4: Bid with confidence
  • Step 5: Celebrate and settle

Couple researching home loans

How much money do I need for a house deposit?

There is no magic number when it comes to a deposit, however in Australia the majority of lenders require you to have saved 10% of the property’s value (a couple of lenders may only require 5%).

How do I calculate a deposit?

This means if you’re looking to buy a residential property with a value of $800,000, you’ll need a deposit somewhere between $40,000 (5% of $800,000) and $80,000 (10%).

If you only have a 5% deposit, be aware that this needs to comprise “genuine” savings – i.e. it’s not dependent on your brother selling his car, or a loan from a friend. These are the things that make lenders nervous. Your deposit will affect how much you are able to borrow from your lender. Please keep in mind that money from a parent or third party is known as a gift and not considered genuine savings.

A rule of thumb is, the smaller your deposit, the more rigid the regulations are on it. If you’ve only got a 5% deposit it has to be genuine savings. if you’ve got 10% or more, a gift (from a parent, for example) can be part of it.

If you’re buying an investment property, lenders tend to be more rigid, with most requiring a deposit of at least 10% of the property’s value.

How much deposit do I need as a first home buyer?

Whether you are buying your first home or your sixth property – and using equity from your previous homes to do so – the rules are still the same. You’ll need at least 5% (and 10% for investors) of the value of the home to put down as a deposit. The same rules apply if you bought a home back in ‘82 and sold it in ‘95, and want to buy a new property in 2018. Just because you’ve done it once, doesn’t mean you get a special deposit discount the second time round.

How do I buy property with no money down?

If you haven’t saved a deposit but want to buy property, and don’t have a sugar mummy, all is not lost. You’ll need to qualify for what’s known as a guarantor loan. A guarantor is usually a family member who is legally responsible for paying back the entire loan if you cannot – or will not (I will not, I say!) – make the loan repayments.

The guarantor will also have to pay any fees, charges and interest. If you have a direct family member who can act as guarantor and use their property as guarantee, you may be eligible for a guarantor loan. Read more about guarantor loans and how to get a loan with no deposit

Can I get a home loan with a 5% deposit?

These days, it’s recommended home buyers save as much as 20% of the home’s value to put towards a deposit. But raising a 20% home loan deposit makes it challenging for first-time buyers to enter the property market – particularly given the high prices in our capital cities. The good news though, is that under some circumstances you may be able to secure a mortgage with as little as a 5% deposit. You’ll need to meet eligibility criteria and you’ll have to look ‘safe’ on paper to offset the increased risk your high loan-to-value ratio (LVR) presents.

Typically you’ll need:

  • A clean credit history – on-time repayments on existing debts over at least the last six months
  • A strong asset position – the lender will determine the strength of your assets based on your age and income
  • Stable employment – you will typically need at least six months in your current job, although some exceptions may apply
  • Low personal debt – this figure should not amount to more than five per cent of the value of your property
  • Some genuine savings – this should amount to at least five per cent of the property’s value to make up the shortfall of the loan, and cover the expenses associated with buying a property

Moving house
  • Moving house

What costs are involved in buying a house in NSW?

The costs involved in buying a home differ from state to state, not only because of the variance in house prices but due to things like stamp duty and legal costs – which tend to be higher in metropolitan cities.

How much is stamp duty on a house in NSW?

, we can see that the stamp duty on a $32 million house in Wolseley Road, NSW is $2,180,768; whereas on a $322,000 studio apartment in Tuggeranong, ACT it is $6,548.

As well as the stamp duty fee itself, you’ll have to pay a transfer fee and a mortgage registration fee. The transfer fee is usually around $200-$300 and the mortgage registration fee around $100-$150.

Before you exchange contracts with the seller, you’ll want to hire a conveyancer. The legal work involved in preparing the contract of sale for a property (if you’re selling), reading it thoroughly and making any changes (if you’re buying), home loan documents and other related docs, is called conveyancing. Costs will differ depending on who you use, but you can expect to pay anywhere from $600 to $1500.

Read: Costs involved in buying and selling property

How can I invest with no money?

Really? Sorry bud, you’re going to need some money to invest. Unless you’re Kyle MacDonald. When it comes to buying an investment property, most lenders will want to see a deposit that equates to 10% of the property’s value. In rare cases you might be able to get a guarantor loan, but these are usually reserved for owner/occupiers so don’t get your hopes up.

How much does an average house cost in Australia?

Australian property prices are talked about in Australia more than the weather is in the UK – and that’s saying something. Asking how much an Australian house costs is a bit like asking the cost of a flat white: it really depends on where you are. In Sydney, a flat white is usually around $3.50 although if you go somewhere like Thirroul on the South Coast it’s not uncommon to pay $4. And don’t get me started on Darwin, where a (pretty average, if we’re being honest) latte can set you back $5! Unbelievable! Especially when you can get all-day parking for twice that! Hang on, we’re talking about property aren’t we?

The median property prices in each state change month-to-month, but here’s where they stand, according to February 2018 CoreLogic data:


5 stars for our service reviews from clients

Book Call Now

UNO home loans

Try Plans, by UNO
Mortgage calculators completely reimagined
Get Started
Considering a purchase or refinance?

Try Plans by UNO

Mortgage calculators completely reimagined
Get Started
☎ đŸš« No cold call promise

Related Articles

TESTIMONIALS

What our customers are saying

Kathryn Cretney
November 14, 2024
5 stars for our service reviews from clients
Paul helped us from day one before we even arrived in Australia so we knew exactly what we needed to prepare. He’s got a tonne of knowledge and was really lovely and supportive to deal with. Helpful and easy going. Would highly recommend - now in our first Aussie home and Paul made the process all very easy!
Read more
Sean O'Neill
November 14, 2024
5 stars for our service reviews from clients
We received excellent service and a tailored solution to our home loan requirements from Uno. Paul kept us informed at all milestone stages and throughout the process he demonstrated a ‘can do’ attitude that ultimately allowed us to get over the line and meet our deadline. We’re most grateful and very impressed. Highly recommend
Read more
Crush Huston
November 8, 2024
5 stars for our service reviews from clients
Paul is an amazing broker. Communicative, responsive and knows his stuff! Highly recommend
Read more
Amanda Pearce
November 7, 2024
5 stars for our service reviews from clients
After just four months in Australia, our New Zealand home sold, prompting us to stop renting and invest locally. We found Paul through a Kiwi Facebook group, and his exceptional service exceeded our expectations. From initial contact, Paul provided clear explanations, friendly communication, and prompt responses to our queries, making our mortgage process remarkably smooth. We highly recommend him.
Read more
Dom Saric
November 3, 2024
5 stars for our service reviews from clients
Mike Parsons went above and beyond to ensure that our refinancing journey was painless and successful. He was communicative, accessible (even working while on holidays!), and his knowledge of the systems at play meant that he picked up on things that other brokers missed. Would 100% recommend Mike, and will definitely be back next time we need a broker.
Read more
Ashleigh Breaden
October 31, 2024
5 stars for our service reviews from clients
Mike Parsons handled our refinance of our home loan with ease and a depth of knowledge that ensured we got the best deal possible for our situation. We didn't have an easy one to solve for with my husband being self employed and we were consolidating finances as well for a car loan. But Mike handled it all for us and once we had provided him with all the documents we literally didn't have to do a thing after that, it was so easy and so quick we are super happy with the experience! Top notch! Highly recommend!!
Read more
Kyle Richards
October 10, 2024
5 stars for our service reviews from clients
Absolute legend, helped me through the first home buyers scheme, explained everything in a way that made sense, was very knowledgeable and a joy to work with.
Read more
Chloe S
October 8, 2024
5 stars for our service reviews from clients
Mike Parsons made it possible for us and the in laws to get 2 pretty complicated home loans. He helped us through everything and we'd be happy to use Mike and the team again for anything we needed. Thanks again!
Read more
Sam Rezai
October 2, 2024
5 stars for our service reviews from clients
I have gone through 6 different mortgage brokers prior to meeting Andrew Wyers. He is the most patient mortgage broker I’ve encountered and also the most knowledgable about the bank’s lending process and products available. It took me 1 year to find a house I was happy with and Andrew was always there to assist with any issues or questions I had; he always return my phone call, even on the weekends or when his away on holidays. The loan process was smooth and I had no complications. The process with Andrew was again nice and easy, he took the time to find and put together the right package that was suited to my situation. I have recommended Andrew to my family & friends and everyone have been grateful and completely satisfied with his service.
Read more
S Wilko
September 23, 2024
5 stars for our service reviews from clients
I had not dealt with Scott or UNO before finding them on the internet. Even as an Australian citizen living and working overseas, I knew obtaining a loan would be difficult. However, Scott went above and beyond what I expected from a mortgage broker. I genuinely don’t think you could find another company that works as hard as they did to get my home loan approved. I cannot recommend them highly enough. Everyone I dealt with at UNO were extremely professional and helpful. If you are looking for a broker, you would be mad not to give them a go. Thanks to Scott Wilkinson, Dalby Bajwa, Jena Lasquite and Andrew Pacini. Shaun.
Read more
Patrick Winters
August 14, 2024
5 stars for our service reviews from clients
For the past three years, it has been an absolute pleasure to work with Mike Parsons. He has consistently helped us navigate commercial property loans with skill and efficiency. Mike’s timely and professional responses to our inquiries have been invaluable. We have built a strong, reliable relationship with him and eagerly anticipate continuing our collaboration in the future. We highly recommend his services.
Read more
Lee Robibaro
August 6, 2024
5 stars for our service reviews from clients
I am so thankful and grateful to have Scott Wilkinson as my broker. He not only looked after me every step from start to finish he gave me confidence and I was able to trust him and his expertise. My children and I are now happy in our new home and very appreciative of Scott's help. I will definitely be only having Scott as my broker from here onward as there is no mucking around and straightforward answers. Thanks again
Read more