- No deposit mortgages are rare in Australia but can be achieved through guarantor loans, equity use, or government schemes.
- Guarantor loans allow a family member to secure your loan using their property, reducing or eliminating the need for a deposit.
- Government programs like the First Home Guarantee help eligible buyers purchase with as little as 5% deposit, avoiding LMI.
- To qualify, you’ll need a strong financial profile, and it’s a good idea to work with an experienced mortgage broker to find suitable lenders.
Buying a home without a deposit might sound like a dream, but for some Australians, it's a real possibility. While traditional lenders usually require a deposit of at least 5–20%, there are a few legitimate ways to secure a mortgage with little or no upfront cash. If you're a first home buyer or someone struggling to save while paying rent, this guide will walk you through your options.
What Is a No Deposit Mortgage?
A no deposit mortgage is a home loan where the buyer borrows 100% of the purchase price. In the past, some lenders offered true 100% home loans, but these are now almost nonexistent due to the risk involved. Today, a “no deposit” mortgage typically involves using external support—like a guarantor or government scheme—so the buyer doesn’t have to contribute their own savings upfront.
It’s important to note: even with a no deposit mortgage, you may still need funds to cover additional costs like stamp duty, conveyancing fees, and moving expenses.
How Can You Get a Home Loan Without a Deposit?
1. Using a Guarantor
One of the most common ways to access a no deposit loan is through a guarantor mortgage. A guarantor (often a parent or close family member) uses the equity in their property as security for part (or all) of your loan.
Key points:
- You may be able to borrow 100% of the purchase price.
- No Lenders Mortgage Insurance (LMI) is needed if the guarantor covers 20% or more.
- The guarantor’s property is at risk if you default, so everyone should seek independent legal and financial advice.
2. Using Equity from Another Property
If you’re already a property owner, you may be able to use the equity in your existing home as security for a new property, essentially unlocking a no deposit loan without needing cash. This strategy is popular among investors or people buying a second home.
3. Government Grants and Schemes
The First Home Guarantee allows eligible first home buyers to purchase with as little as a 5% deposit, with the government guaranteeing the remaining 15% to avoid LMI.
Similarly, the Regional First Home Buyer Guarantee helps buyers in regional areas, while state grants and stamp duty exemptions can free up extra funds.
While these schemes don’t offer true 0% deposit loans, when combined with other savings or parental gifts, they can effectively eliminate the need to save a traditional deposit. Speak to a free mortgage broker to find out the best options for you. Simply fill out the form below, and a broker from Eden Emerald Mortgages will get in touch.
Pros and Cons of No Deposit Mortgages
✅ Pros
- Get into the property market faster
- Avoid years of saving
- Parental support can reduce borrowing costs (no LMI)
❌ Cons
- Not widely available (limited lender options)
- Strict eligibility requirements (good credit score, reliable income)
- Still need to pay for stamp duty, legal fees, inspections
- Guarantor takes on financial risk
What Lenders Offer No Deposit Options?
Most major banks won’t offer no deposit loans unless a guarantor is involved. However, some lenders—including non-bank and second-tier lenders—specialise in these types of home loans.
A mortgage broker from EE Mortgages can help you find a lender that accepts:
- Guarantor-backed applications
- Buyers using government grants or parental gifts
- Strong rental repayment history as proof of savings
Tips to Strengthen Your Application
If you’re aiming to buy with no deposit, your application will need to show:
- A clean credit report
- Stable, ongoing employment
- Minimal existing debts
- A track record of managing rent or savings responsibly
The more financially disciplined you appear, the more likely lenders will feel confident in offering you a no deposit solution.
Final Thoughts
A no deposit mortgage isn’t easy to secure, but it is possible. If you have family support or qualify for a government guarantee, you may be able to get into your first home sooner than expected. Just remember to do your homework, understand the risks (especially for guarantors), and speak with a mortgage broker who can assess your options.
Buying a home is a big decision, and whether you have a deposit or not, the right advice can make all the difference.
Speak to an Expert and
Get Your Mortgage Approved
To get started on your journey of securing a home loan, fill in the form below, and an experienced mortgage broker will contact you about your personal situation. You can also call us directly on (02) 9188 9398.
