Understanding No Deposit Home Loans 

A no deposit home loan allows you to attain approval for the entire property value without the necessity of an initial deposit. In Australia, the most prevalent zero-deposit option is the guarantor home loan. 

Determining Borrowing Limits 

• Secure up to 105% of the property value with a guarantor, often involving your parents home in Australia. 
• Explore up to 100% using the equity in another property. 
• Access up to 95% with the First Home Guarantee. 
• Borrow up to 95% with a gift as a deposit, subject to specific conditions. 
• Consider up to 95% with a personal loan as a deposit, applicable to low-risk borrowers. 
• Explore up to 95% under a shared-equity scheme. 

Factors Influencing Approval 

Lenders typically lean towards approving guarantor home loans due to their low-risk nature as a no deposit option. 

Interest Rates and Lenders 

Competitive interest rates are available, providing you with options from both specialist and major lenders. 

Assistance in Qualification 

We are here to assist you in determining if you qualify for purchasing a property anywhere in Australia. 

Options for No-Deposit Home Loans 

105% Guarantor Loan 

This top-tier zero-deposit option allows you to borrow 105% of the purchase price without needing personal savings. The loan is secured by guarantors against their property. 

Qualification Criteria: 

• Guarantors must have equity in their property to cover the guarantee. 
• While working guarantors (typically parents) are usually preferred, exceptions may be made for retired guarantors. 
• The guarantor’s property must be in Australia. 

Reasons to Choose a Guarantor Home Loan: 

• For Borrowers: Access the full purchase amount without saving for a deposit, with no need for Lenders Mortgage Insurance (LMI) and often low-interest rates. 

• For Guarantors: Fixed liability, secured by property or a term deposit, with no obligation for scheduled loan repayments. 

Utilizing Equity As a Deposit 

For property owners, some lenders accept home equity as a deposit, eliminating the need for additional savings. In certain cases, lenders may even offer a cash rebate for refinancing. 

Options for Low-Deposit Home Loans 

First Home Guarantee (5% Deposit) 

This nationwide program supports first-home buyers with a deposit as low as 5%, bypassing Lenders Mortgage Insurance. Eligibility criteria apply. 

Gifted Deposit Home Loan (5% – 15%) 

Parents can provide a lump sum as a non-refundable gift, covering a percentage of the purchase price. 

Personal Loan As A Deposit 

While some lenders accept personal loans, it’s not the preferred option due to potential repayment challenges. 

Using Super To Purchase a House 

For those with over $300,000 in superannuation, setting up a self-managed superannuation fund (SMSF) allows the purchase of an investment property. 

Application for a Shared-Equity Scheme 

In a shared-equity scheme, an equity partner contributes to the property purchase in exchange for an interest in the property. 

Pros And Cons Of No-Deposit Home Loans 

Cons: 

• Stricter eligibility requirements. 
• Limited lender choices. 
• Higher risk of negative equity. 
• Potential for over-borrowing. 

Pros: 

• Accessibility without substantial savings. 
• Faster home ownership. 
• Investment opportunities. 
• Potential for government assistance. 

Navigating Approval for a Home Loan Without a Deposit 

Lending Criteria for No-Deposit Loans 

Lenders evaluate credit history, repayment history, location restrictions, property type, stable employment, income, and profession. 

Requirement for Savings? 

• No savings are required for a no-deposit home loan with a guarantor. 
• In other situations, a 5%-10% deposit is typically needed based on the type of borrower: 
• First-home buyers: 5% deposit. 
• Second-home buyers: 10% deposit. 
• Investors: 10% deposit. 
• Building a property/construction: Additional savings may be required for construction financing.