What Is A No-Deposit Home Loan?

A no-deposit home loan allows an eligible borrower to purchase a property without contributing a traditional cash deposit from their own savings.

These arrangements are sometimes called 100% home loans because the borrower may finance the entire property purchase price.

However, lenders generally require another source of security or funding, such as a family guarantor or equity in an existing property.

It’s also important to distinguish between borrowing 100% of a property’s purchase price and having a 100% loan-to-value ratio (LVR) against all properties securing the loan.

For example, if a lender takes security over both the property you’re buying and a guarantor’s property, the total security available is greater than the value of the property being purchased.

No deposit doesn’t mean no costs. You may still need funds for stamp duty, legal fees and other purchase expenses unless your approved financing arrangement covers them.

How Can You Buy A House With No Deposit?

There are two main ways to buy property without contributing a conventional cash deposit.

1. Use a Guarantor Home Loan

A guarantor home loan allows an eligible family member, commonly a parent, to provide additional security for your mortgage using equity in their property.

This may enable you to borrow the full purchase price without saving a traditional deposit.

Depending on lender policy, some arrangements can provide funding of up to 105% of the purchase price to help cover costs such as stamp duty and legal fees.

For example, on a $700,000 property, a lender might consider financing the full $700,000 purchase price, with additional borrowing for eligible purchase costs.

The loan would be supported by the property being purchased and an agreed portion of the guarantor’s property security.

This structure may also avoid Lenders Mortgage Insurance (LMI), provided the overall security arrangement meets the lender’s requirements.

What Are the Requirements for a Guarantor Home Loan?

Lenders will generally assess:

• The guarantor’s relationship to the borrower.
• The guarantor’s available property equity and financial circumstances.
• Your income, living expenses, existing debts and repayment capacity.
• Your credit history and employment circumstances.
• The property you’re buying and the total security offered.

The guarantor must understand the risks. If you fail to meet your repayments, they may become liable under the guarantee, potentially putting their property at risk.

Guarantors should obtain independent legal advice and appropriate financial advice before proceeding.

Read more about Guarantor Home Loans.

2. Use Equity in an Existing Property

If you already own property, you may be able to use your available equity to fund the deposit and purchasing costs for another property.

Equity is the difference between your property’s current value and the amount you owe against it.

However, not all equity is available to borrow.

For example, suppose:

• Your existing property is valued at $800,000.
• Your current home loan balance is $300,000.
• A lender permits borrowing up to 80% of the property’s value.

The maximum lending against that property would be $640,000, leaving up to $340,000 in potentially usable equity before considering fees and your borrowing capacity.

That equity could potentially fund the deposit and costs of another property purchase.

You would still need to qualify for any additional borrowing, and using equity increases the debt secured against your existing property.

This approach is commonly explored by existing homeowners, property upgraders and investors.

Learn more about Using Home Equity.

What If You Don't Have a Guarantor or Property Equity?

Not having family support or an existing property doesn’t necessarily mean you must save a 20% deposit.

Several low-deposit home loan options may be available, depending on your eligibility.

1. Buy With a 2% Deposit Through a Specialist 98% Home Loan

Some specialist lenders offer home loans up to 98% LVR, meaning eligible borrowers may be able to contribute as little as 2% of the property’s value towards the purchase price.

As of 15 October 2026, we have a lender on our panel which offers qualifying owner-occupied and investment home loans up to 98% LVR.

Unlike a guarantor loan, this type of product doesn’t require a family member to provide additional property security.

It also doesn’t involve the government taking an ownership interest in your home.

Instead of traditional LMI, it uses a Rate Reduction Fee (RRF). This is a separate fee calculated based on the loan amount, LVR, and the selected lending product.

How Much Deposit Do You Need for a 98% Home Loan?

These are illustrative deposit calculations, not loan quotes. They exclude the RRF, stamp duty, conveyancing costs and other fees.

A specialist 98% loan is not a zero-deposit loan. Some borrowers may also need to demonstrate genuine savings beyond the minimum property deposit.

Eligibility can depend on your income, credit history, employment, visa status, existing property ownership and the type and location of the property.

Some specialist loans also restrict construction, vacant land and certain high-density apartments.

Home Loan Experts insight: Before deciding that a 2% deposit is sufficient, ask a broker to calculate your total funds required to settle. Your deposit, genuine-savings requirement and cash needed to complete can be three different figures.

Learn more about 98% Home Loans and 2% Deposit Options.

2. Use the Australian Government 5% Deposit Scheme

Eligible buyers can purchase with a smaller deposit through the Australian Government 5% Deposit Scheme.

The minimum deposit is:

• 5% for eligible first-home buyers and certain returning buyers.
• 2% for eligible single parents and single legal guardians with dependent children.

Eligible borrowers do not pay LMI because the government provides a guarantee to the participating lender.

There are no scheme income caps, but property-price limits and other eligibility criteria apply.

Unlike a private specialist loan, this is a government-backed lending arrangement.

Learn more about the Australian Government 5% Deposit Scheme.

3. Consider Help to Buy

Help to Buy is a government shared-equity scheme that allows eligible buyers to purchase with a minimum 2% deposit.

The Australian Government contributes up to 30% of the purchase price for an existing home or 40% for a new home, reducing the size of the mortgage.

In exchange, the government takes a corresponding equity interest in the property.

Unlike a specialist 98% loan, Help to Buy doesn’t require you to borrow almost the entire property price.

However, income thresholds, property-price limits, residency and other scheme restrictions apply.

Learn more about the Help to Buy Scheme.

4. Use a Gifted Deposit

Some lenders accept genuine, non-repayable monetary gifts from parents or other eligible family members towards a property deposit.

This can help buyers who haven’t saved the deposit themselves.

However, lenders may require a signed gift declaration, evidence of where the funds came from and additional genuine-savings documentation.

A gifted deposit is different from a guarantor loan because the family member contributes money rather than offering property as security.

5. Explore First-Home-Buyer Grants and Savings Schemes

Eligible first-home buyers may be able to access a state or territory First Home Owner Grant, stamp-duty concessions or the First Home Super Saver Scheme.

These initiatives can help with the amount of savings needed, although eligibility and lender treatment vary.

A grant or savings scheme doesn’t automatically replace the deposit required by a lender or guarantee loan approval.

No Deposit vs 2% Deposit vs 5% Deposit Home Loans

The amount of money you have available can influence which lending strategies are worth considering.

Each option has different approval requirements and financial consequences.

For instance, a guarantor loan may eliminate the need for your own cash deposit but exposes a family member’s property to risk.

A specialist 98% home loan removes the need for a guarantor but generally leaves you with a substantial mortgage relative to the property’s value.

A government scheme may reduce upfront costs, but scheme conditions or shared-equity obligations may apply.

The best starting point is to understand what you can afford to repay, not simply which option lets you contribute the least money.

Who Qualifies for a No-Deposit Home Loan?

Lenders look beyond the amount of savings you’ve accumulated.

Depending on the loan structure, they will assess:

• Borrowing capacity: Whether your income can support mortgage repayments alongside living expenses and existing debts.
• Credit history: Your repayment conduct, credit commitments and any adverse credit events.
• Employment and income evidence: The stability and verifiability of your income, based on the lender’s credit policy.
• Property security: Whether the purchased property and any additional security meet the lender’s requirements.
• Guarantor or equity position: Whether additional security is sufficient and legally acceptable.
• Funds to complete: Whether the proposed financing covers the deposit, lender fees and purchase costs, or whether additional cash is required.

Some lenders may consider circumstances such as shorter employment histories or alternative genuine-savings evidence, but the requirements differ by product.

An assessment from a mortgage broker can help establish which options are realistically available before you apply.

Find Out Which Home Loan Options You May Qualify For

Use our calculator to explore potential lending pathways based on your income, available savings, existing property ownership, family support and other commitments.

The calculator is a guide only and doesn’t represent lender approval. A mortgage broker will need to verify eligibility, loan features, borrowing capacity and the funds required to complete the purchase.

What Are the Risks of Buying Without a Deposit?

Buying without a traditional deposit may help you enter the property market earlier, but it can also increase your financial risk.

• Higher Loan Repayments: Financing the entire purchase price means taking on a larger debt than someone who contributes a 10% or 20% deposit. This can result in higher repayments and greater exposure to interest-rate changes.
• Risk to Your Guarantor: If a family member guarantees your loan and you cannot meet your obligations, the lender may seek repayment under the guarantee. The guarantor’s property may be at risk depending on the agreement.
• Limited or Negative Equity: If property values decline, your outstanding loan may exceed the value of the property. This can restrict your ability to refinance, sell or access additional lending.
• Restrictions on Future Borrowing: Additional guarantees, property security and high loan balances can affect the ability of you or your guarantor to borrow again.
• Purchasing Costs and Unexpected Expenses: Even if your loan arrangement covers the purchase price, you’ll need to understand whether it also covers lender fees, conveyancing, inspections and other expenses. Don’t assume a 100% purchase-price loan means nothing is payable from your own funds.

How To Apply For A No-Deposit Home Loan

Step 1: Understand Your Available Resources

Work out whether you have access to a family guarantor, usable property equity, a gifted deposit or a smaller amount of savings.

Step 2: Check Your Borrowing Capacity

A broker can assess your income, expenses, credit history and other liabilities to estimate how much you may be able to borrow.

Step 3: Compare Suitable Loan Structures

This may include a guarantor mortgage, an equity-funded purchase, a government scheme or a specialist 98% home loan.

Step 4: Calculate Your Total Funds Required

Include purchase costs, lender fees and any applicable LMI or alternative fee.

Step 5: Prepare the Application

Provide the required income, identity, savings and security documents. Guarantor arrangements may also need independent legal advice and additional paperwork.

Step 6: Complete Property and Finance Checks

Before committing to a purchase, confirm the relevant finance conditions, property eligibility and valuation requirements with your broker and conveyancer.

General information only. Credit approval is subject to lender eligibility, serviceability, security requirements, fees and other conditions. Maximum LVRs and examples do not guarantee approval or the availability of finance.