No Deposit Home Loans: Options & Costs

No Deposit Home Loans

Buying without a cash deposit may be possible through some family guarantee arrangements, but it depends on the lender, the security offered and your ability to repay. A government low-deposit scheme still requires your own contribution. Start by separating three questions: how much cash you need, what security the lender accepts, and what repayments your budget can comfortably support.

What does no deposit actually mean?

The term usually describes a purchase where the buyer contributes little or no cash towards the price because a lender accepts additional security. For example, Westpac describes family guarantee lending that may cover the purchase price and some costs, subject to its conditions. This is a specific lending arrangement, not a feature available to every buyer.

With a property guarantee, a family member offers security for the loan. They are taking on a legal obligation, even if they do not transfer cash to you. The amount and scope of that obligation need to be understood before anyone commits.

Sources: Westpac: Family Security Guarantee customer guide; CommBank: Guarantor support and risks.

Government support still needs a deposit

The Australian Government 5% Deposit Scheme supports eligible first home buyers with a minimum 5% deposit, or eligible single parents and legal guardians with a minimum 2% deposit, without Lenders Mortgage Insurance. These are low-deposit pathways.

Since 1 October 2025, the scheme has had no income caps. Property price caps, borrower eligibility and ongoing obligations still apply. Applications go through participating lenders, which must separately approve the loan. The government guarantee supports the lender; you remain responsible for the debt. Check current criteria for the property and your circumstances.

Sources: Housing Australia: Australian Government 5% Deposit Scheme.

Build a budget beyond the deposit

Allow for legal work, inspections, moving expenses and any applicable duty or lender charges. Confirm which costs must be paid from your savings and when they fall due. An advertised borrowing limit is not a settlement budget.

Lenders assess income, expenses, debts, employment and credit history as well as the deposit. Additional security does not create spare income. Test your repayments against a higher interest rate and leave room for maintenance and unexpected bills.

Sources: ASIC Moneysmart: Save for a house deposit; ASIC Moneysmart: Buying a house.

Choose a practical next step

Write down your available savings, likely purchase range and comfortable repayment amount before comparing pathways. Include a savings target alongside any family support option so you can see what waiting would change. Bring those figures to a Foster Ramsay Finance conversation to help frame the questions. This guide is general information; the suitable path depends on your circumstances.

Sources: ASIC Moneysmart: Save for a house deposit; ASIC Moneysmart: Buying a house.

Frequently asked questions

Can the government provide my entire deposit?

The 5% Deposit Scheme does not do that. It provides a lender guarantee and requires a minimum buyer deposit. Other assistance has separate eligibility and conditions.

Does a guarantor guarantee approval?

No. The lender must accept the arrangement and approve the borrower, loan and security. A guarantor cannot remove the need for an affordability assessment.

Is Lenders Mortgage Insurance protection for me?

No. LMI protects the lender if the borrower defaults. It does not cover your repayments or protect a guarantor from their obligations.

Sources & further reading

Official guidance and lender information used in preparing this guide. Policies can change; confirm the current rules before making a decision.

General information only, not personal credit, legal or tax advice. Loan availability, fees and terms depend on your circumstances and the lender’s assessment. Approval is not guaranteed.