For many Australians, the biggest barrier to buying a home isn’t the monthly repayments — it’s saving the deposit. With property prices rising in cities like Sydney, Melbourne, and Brisbane, saving a traditional 20% deposit can take years. The good news is that it is possible to apply for a home loan with no down payment. A growing number of Australians are now buying property using no deposit home loans in Australia, guarantor loans, family equity, and government programs designed to help first-home buyers enter the market faster.
The Complete Guide to Buying Property With $0 Deposit
In this guide, I’ll walk you through how to buy a house with no deposit in Australia, the strategies lenders actually accept, and the steps you can take today to secure a zero deposit home loan Australia borrowers can qualify for.
What Is a No Deposit Home Loan?
A no deposit home loan, also called a zero deposit home loan, allows you to purchase a property without contributing a cash deposit upfront.
Instead of using your own savings, the lender may accept:
- A family guarantor
- Equity in another property
- Government-backed home buyer schemes
- A gifted deposit
- Certain rent-to-buy arrangements
In most cases, these loans are structured as 100% home loans, meaning the lender finances the entire property value.
Because the lender is taking on additional risk, no deposit home loans Australia lenders offer usually come with stricter lending criteria and slightly higher interest rates.
Is It Possible to Get a Home Loan With No Down payment in Australia?
Yes — but it depends on your financial situation.
While most banks prefer a 5–20% deposit, many borrowers still manage to buy a house with no deposit through specialist lending structures.
The most common pathways include:
- Guarantor home loans
- Government home buyer schemes
- Using equity in another property
- Family gifted deposits
- Low deposit loans combined with grants
Government programs such as the Home Guarantee Scheme help thousands of Australians buy property with very small deposits each year.
Authority source: Housing Australia
https://www.housingaustralia.gov.au/support-buy-home/home-guarantee-scheme
How to Apply for a Home Loan With No Down Payment in Australia
Applying for a home loan with no down payment requires careful planning. Lenders will want strong evidence that you can manage the repayments even without a deposit.
Here are the typical steps.
Step 1: Assess Your Financial Position Before Applying
Before applying for a no deposit home loan Australia lenders offer, review your:
- Income stability
- Credit score
- Current debts
- Living expenses
- Rental history
Most lenders want to see at least 12 months of clean rental history, stable employment, and strong financial discipline.
A higher credit score dramatically improves your chances of approval.
You can check your credit report through services such as Equifax
Step 2: Secure a Guarantor to Enable a 100% Home Loan
The most common way to buy a house with no deposit is through a guarantor home loan.
A guarantor — typically a parent — uses equity in their own property as security.
The typical loan structure looks like this:
- 80% secured against the new property
- 20% secured against the guarantor’s property
This structure allows borrowers to avoid Lenders Mortgage Insurance (LMI) while still borrowing 100% of the purchase price.
Step 3: Find Home Loan Lenders With No Deposit Options
Not every lender offers no deposit home loans, but several Australian lenders and non-bank lenders support these structures.
Common lender brands people search for include:
- Commonwealth Bank
- NAB
- Westpac
- ANZ
- Macquarie Bank
- Pepper Money
- Liberty Financial
- Bluestone Home Loans
Many borrowers also work with mortgage brokers to access specialist home loan lenders with no deposit options that may not be widely advertised.
Step 4: Structure the Loan Properly
When applying for a zero deposit home loan Australia borrowers qualify for, the structure matters.
Your loan may include:
- The full property purchase price
- Stamp duty and purchasing costs
- A guarantor security portion
An experienced broker will structure the loan so the guarantor guarantee can potentially be removed later once sufficient equity builds.
Step 5: Submit Documentation and Loan Application
To apply for a home loan with no down payment, lenders usually require:
- Proof of income
- Tax returns (if self-employed)
- Bank statements
- Evidence of rental history
- Details of debts and liabilities
- Guarantor property details (if applicable)
Once submitted, approval timelines typically range from 3 to 10 business days depending on the lender.
Key Pathways to Buy a House With No Deposit
There are several legitimate ways Australians successfully buy a house with no deposit.
Guarantor Loans (Most Popular Strategy)
Guarantor loans allow borrowers to purchase property without savings by using family property equity.
Advantages include:
- Borrow up to 100%
- Avoid Lenders Mortgage Insurance
- Enter the property market sooner
Risks include potential liability for the guarantor if repayments fail.
Family Home Guarantee Scheme
The Family Home Guarantee and First Home Guarantee allow eligible buyers to purchase with deposits as low as 2–5%.
The government guarantees a portion of the loan, reducing lender risk.
Source: Housing Australia
Using Equity in Another Property
If you already own property, you may be able to use existing equity as a deposit.
For example:
- Existing home worth: $800,000
- Loan balance: $400,000
You may be able to release equity to fund a second property purchase without saving a deposit.
Gifted Deposits (Bank of Mum and Dad)
Many first-home buyers receive gifted deposits from family.
Some lenders allow this to replace traditional savings provided the funds are clearly documented.
Rent-to-Buy Property Programs
Rent-to-buy arrangements allow tenants to build equity while renting, eventually converting the agreement into a home purchase.
These are less common but do exist through certain property programs.
Lending Criteria for No Deposit Home Loans
Because lenders take on higher risk, lending criteria for no deposit home loans are strict.
Typical requirements include:
High Credit Score
Borrowers generally need a strong credit score with agencies such as Equifax or Experian.
Responsible Repayment History
Lenders review repayment behaviour across:
- Credit cards
- Personal loans
- Buy now pay later accounts
- Rent payments
Stable Employment Income
Most lenders prefer:
- At least 6–12 months in current employment
- Consistent income history
- Sufficient income buffers
How Much Extra Could a No Deposit Home Loan Cost?
A zero deposit home loan can sometimes cost more than a standard mortgage.
Costs may include:
- Slightly higher interest rates
- Additional risk loading
- Possible Lenders Mortgage Insurance (LMI) if no guarantor is used
For example:
Property price: $700,000
Deposit: $0
Loan: $700,000
Compared with a borrower who provides a 20% deposit ($140,000), the monthly repayments may be higher.
Example: Buying a $700,000 Property
Scenario 1 – No Deposit Home Loan
Property price: $700,000
Deposit: $0
Loan amount: $700,000
Assume interest rate: 6.50%
Loan term: 30 years
Estimated monthly repayment: $4,424
Scenario 2 – 20% Deposit Home Loan
Property price: $700,000
Deposit: $140,000
Loan amount: $560,000
Interest rate: 6.50%
Loan term: 30 years
Estimated monthly repayment: $3,539
Monthly Difference
$4,424 – $3,539 = $885 more per month
Total Interest Over the Life of the Loan
No deposit loan (borrow $700k):
Total repayments ≈ $1,592,000
20% deposit loan (borrow $560k):
Total repayments ≈ $1,274,000
Approximate difference:
$318,000 more over 30 years
However, many buyers accept this trade-off to enter the property market sooner instead of spending years saving.
4 Ways to Buy a Home With a Low Deposit Instead
Even if a 100% home loan isn’t available, there are several ways to buy property with very small deposits.
1. Home Guarantee Scheme
The government guarantees part of the loan, allowing deposits as low as 2–5%.
2. Using Superannuation (First Home Super Saver Scheme)
Eligible buyers can withdraw voluntary super contributions for a deposit.
Source:MoneySmart
3. Help to Buy Scheme
A shared equity program where the government contributes toward the purchase price. Home buyer pays only 2% deposit.
4. Gifted Deposits From Family
Also known as the Bank of Mum and Dad, this is one of the most common deposit solutions in Australia.
Are No Deposit Home Loans Good for First-Time Buyers?
For many Australians, no deposit home loans for first-time buyers provide a realistic path into the property market.
Benefits include:
- Buying sooner before prices rise further
- Avoiding years of deposit savings
- Potential capital growth during ownership
However, borrowers should ensure repayments remain affordable even if interest rates increase.
Frequently Asked Questions No Deposit Home Loans
Can you buy a house with no deposit in Australia?
Yes. It is possible to buy a house with no deposit through guarantor home loans, government guarantee schemes, gifted deposits, or using property equity.
Which banks offer no deposit home loans in Australia?
Some major lenders that may support guarantor or low-deposit structures include:
- Commonwealth Bank
- Westpac
- NAB
- ANZ
- Macquarie Bank
Specialist lenders may also offer flexible options through mortgage brokers.
What credit score is needed for a no deposit home loan?
Most lenders prefer good to excellent credit scores, typically above 650–700 depending on the lender.
Do you pay Lenders Mortgage Insurance with a zero deposit home loan?
If you use a guarantor structure, you may avoid LMI. Without a guarantor, LMI can be very expensive.
Is it harder to get approved for a no deposit home loan?
Yes. Because lenders take on more risk, borrowers must demonstrate:
- Strong income
- Excellent repayment history
- Stable employment
Enter the Property Market Sooner
Saving a 20% deposit can take years — especially in Australia’s competitive property market.
The good news is that no deposit home loans Australia buyers use today make it possible to buy property much sooner through guarantor structures, government schemes, or family equity.
If you’re exploring how to apply for a home loan with no down payment, the smartest next step is to compare lenders, loan structures, and repayment options.
Before applying, I always recommend reviewing your borrowing power and comparing multiple lenders to find the most competitive deal.
To see what options may be available to you, compare home loan rates on RateBuster or use the RateBuster mortgage calculators to estimate your repayments and borrowing power today.
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