ANZ Bank in 2026: Profits Up, Strategy Shift, and What It Means for Borrowers
ANZ Bank started 2026 with a strong financial result but also significant internal changes and strategic shifts that have a...
How much can I borrow?
- Borrowing with a guarantor loan can get you up to 105% of the property’s value (includes purchase + costs).
- Borrow without a guarantor for up to 95%.
- Borrow up to 90%–100% with no LMI if you are in a preferred profession (e.g. doctors, lawyers, accountants, sports professionals).
Will I be approved?
Normally, you will need a 5%–10% deposit.
- Guarantor loans do not require a deposit.
- Parents gifting a deposit is also accepted.
- First Home Owner Grant (FHOG) can be used as part of your deposit.
First home buyer loan rates vary by lender, deposit size, and loan type (2025)
| Type | Rate Range (p.a.) |
|---|---|
| Variable rates | approximately 5.8% to 6.5% p.a. |
| Fixed rates (2-year) | approximately 5.6% to 6.3% p.a. |
| Low deposit loans (LVR above 80%) | typically 0.1% to 0.3% p.a. higher than standard rates |
Borrowers with a 20% deposit and strong income profile generally access the most competitive rates. Your actual rate depends on your lender, deposit size, and financial profile.
Use our Borrowing Capacity Calculator:
Borrowing Capacity Calculator
Lenders
You can get loans from major banks, smaller lenders, and non-bank lenders.
Different lenders have different policies—selecting the proper one is very important.
Purchasing Your First Home
Can Be Stressful Especially When You Hear That You Need 20% Deposit.
It Will Take Most First-Time Buyers Years to Save That Much.
Actually, the truth is quite Different.
By using a smart strategy, getting government assistance, and choosing the right lender, many first home buyers manage to enter the market with very low deposits – sometimes as low as 5% or even with zero deposit.
Definition of a First Home Buyer Loan
This is not a different product at all— it is a regular home loan which is tailored to suit first home buyers.
What differentiates it is:
- Reduced deposit requirements (down to 5%)
- Use of government programs
- Possibility of LMI waiver or reduction
- More flexible options, like providing a guarantor
The main benefit of these loans is that they aim to eliminate the biggest obstacle: saving for a big deposit.
How Much Deposit Do I Need for My First Home?
Most buyers believe they need a 20% deposit, but in reality, your deposit determines your options—not your eligibility.
| Deposit Size | LMI | What It Means |
|---|---|---|
| 0% | Waived | Requires a guarantor using property equity |
| 5% | Waived (via scheme) or applicable | Entry-level option for most buyers |
| 10% | Usually applicable | More lender options |
| 20% | Waived | Best rates and flexibility |
Important insight:
Your deposit size doesn’t just affect approval—it affects:
- Interest rate
- Loan structure
- Total cost over time
What Other Costs Do I Need to Budget For?
Your deposit is not the only upfront cost. Also budget for:
| Cost Type | Amount |
|---|---|
| Stamp duty | varies by state and property value |
| Legal and conveyancing fees | $1,500 to $3,000 |
| Building and pest inspection | $400 to $800 |
| Lender fees (application, valuation) | $300 to $700 |
| Moving costs | $500 to $2,000 |
As a rule of thumb, allow for an additional $5,000 to $10,000 above your deposit.
Your First Home Journey Starts With the Right Guidance
Buying your first home in Australia can feel overwhelming when you are trying to understand deposits, borrowing limits, lender requirements, and government support options. FS Loan helps simplify the process so you can move forward with more confidence and make smarter home loan decisions from the beginning.
Is buying a home without a deposit possible?
Sure, and in fact, not having a deposit is more usual than people think.
There are basically two options:
Guarantor Loans
Generally, a family member (typically parents) will use the equity in their home as security.
This way, you are able to:
- Need up to 105% of the property value
- Completely avoid going to LMI
- Be on the property ladder quickly
Main risk to consider: The guarantor’s house can be used to repay your debts if you fail to pay your mortgage.
Side note: This is why proper structuring is essential.
Gifted Deposits
Often, parents who cannot be a guarantor go for gifting the money.
Here is what lenders typically require:
- Letter of gift (stating it isn’t a loan)
- Proof of transfer
- Sometimes, the availability of 5% savings, which are genuine
What kinds of home loans are out there?
Getting approved is just as important as picking the right home loan. Different loans come with varying levels of flexibility, security, and risk. Understanding your options allows you to choose a structure that fits your financial goals and lifestyle.
Here’s a quick overview of the most common home loan types and how they work:
Home Loan Types
| Loan Type | Key Features | Best For |
|---|---|---|
| Fixed Rate Loan | Fixed rate for a set period, predictable repayments, limited flexibility | Buyers looking for certainty and protection from rising rates |
| Variable Rate Loan | Changing interest rates over time, flexible repayments, and offset account options | Borrowers who want flexibility and might save money if rates fall |
| Split Loan | Mix of fixed and variable | Buyers looking for stability and flexibility |
| Low Deposit Loan | lets you buy with less than 20% deposit, usually requires LMI | First-Time Buyers Get In Early |
| Interest-Only Loan | Lower initial payments, pay interest only for a set period | Investors looking for cash flow in the short term |
| Guarantor Loan | A family member offers security to reduce the deposit requirement | Buyers with limited savings and a strong family safety net |
Variable Rate Loans
- Flexible repayments
- Unlimited extra payments
- Access to the offset account
- May be increased or decreased in rates
Fixed Rate Loans
- Locked repayments for 1–5 years
- Safety net from rate rising
- Less flexibility
Split Loans
- Combining fixed and variable
- Balances stability and flexibility
What is an Offset Account, and what is its importance?
By far, one of the strongest ways to reduce interest is an offset account.
As an example:
- Loan: $500,000
- Offset balance: $50,000
You are charged interest only on $450,000.
This is capable of saving you tens of thousands of dollars in interest over time.
Foreign Income, Currency & Exchange Rate Impact
If you are earning overseas or planning to move abroad, this becomes critical.
Commonly Accepted vs Risky Currencies
| Currency | Acceptance | Risk Level |
|---|---|---|
| USD | High | Low |
| GBP | High | Low |
| AED | Medium-High | Medium |
| SGD | High | Low |
| PKR | Limited | High |
| INR | Limited | Medium-High |
Why this matters:
- Lenders assess currency stability
- Volatile currencies reduce borrowing power
Exchange Rate Impact (Real Example)
If your income drops 10% when converted to AUD, your borrowing capacity may drop significantly—even if your actual salary hasn’t changed.
This is one of the most overlooked risks for buyers with overseas income.
2025 Foreign Buyer Restrictions (Major Update)
There have been increased restrictions on foreign property buyers.
Highlights:
- Australian passport holders will remain unaffected, even if they are living abroad
- Non-residents are the ones who may be restricted or banned for a period
- Foreign buyers usually need to get approval and may have to pay more
You might need to:
- Take a non-resident spouse into account
- Consider your income from abroad
- Take into account your overseas assets
Therefore, it will be very important to think through how you do your loan.
When dealing with your foreign partner
Having a foreign applicant, single or joint, will bring changes in:
- Getting a loan
- Buying a property
- Getting government assistance
Let’s say your spouse is a foreigner, but you are a citizen:
- The home might be considered a foreign purchase by the authorities
- There might be extra paperwork or restrictions involved
That’s the exact thing that makes a lot of first-home buyers stumble there.
First Home Buyer’s Tax Issues
If you reside abroad or you earn your income overseas:
- From the very first dollar, non-residents will be subjected to tax
- Rents are taxed at a higher rate
- Capital Gains Tax law may be different in this case
What it means for you is that you are allowed to buy a property, and the profit you will get in the follow-up is, on the other hand, affected.
Government Subsidies and Programs (2025)
You can cut down your initial expense substantially through government intervention.
First Home Guarantee (FHBG)
- Make your first property purchase with 5% deposit
- The government will guarantee your remaining 15%
- No need to pay LMI
First Home Super Saver Scheme (FHSS)
- Saving money through super (tax advantages)
- You can withdraw up to $50,000 for deposit
First Home Owner Grant (FHOG)
- $5,000–$20,000 based on your location
- Mostly new properties only
Stamp Duty Concessions
- Partial or full exemption, depending on the state
- Can save you a lot of money upfront
Must Plan for Upfront and Hidden Expenses
You should know the total costs when you purchase your home, even if you can put in a small deposit:
- Lenders Mortgage Insurance (if it’s a case)
- Stamp duty
- Lawyer & conveyancing fees
- Registration fees
- Banking fees
Note: If your loan is backed by a guarantor, several of these could be added to your loan instead of being paid at once.
How a HECS/HELP Debt Can Affect Your Borrowing
Getting a student loan will not directly prevent you from purchasing a property, but it will certainly reduce your borrowing power.
Why?
Because the lenders count your loan repayments as part of your expenses, which in turn will reduce your serviceability.
In fact, even a relatively small HECS debt can result in a borrowing capacity reduction of tens of thousands.
Power of Attorney (What Is It and When Should You Use It?)
If you are:
- Going abroad during the purchase
- Not being able to attend the signing/settlement
You might be required to get a Power of Attorney (POA).
With this, someone you trust is authorized to:
- Sign documents for you
- Get on with the settlement
Otherwise:
- Delays would be common
- Legal complications can occur
How to Buy Your First Home in 5 Steps
Step 1: Find Out If You Are Eligible
Get to know your eligibility for:
- Government incentives
- Lender’s criteria
- Deposit scenarios
Step 2: Gather Your Deposit
- Generate savings
- Use guarantor(s)
- Or create a structured deposit with a gift
Step 3: Acquire the Pre-Approval
You must have pre-approval if you want to move forward.
Otherwise:
- You can lose your deposits at auction
- You don’t know your real budget
Step 4: Look for a House
Be cautious:
- Few properties are high risks
- Some properties not financeable
Examples:
- Very small apartments
- Large rural land
- Unusual zoning
Step 5: Final Approval & Settlement
- You get your loan formally approved
- The legal process is done
- You are handed keys
Is It Time for You to Enter the Property Market?
You don’t actually need to save that 20% for your first home purchase.
Buying that first home can be all about knowing the right options and having the right structure set for your loan.
Guided by a professional, you could even:
- Purchase earlier
- Borrow in the most efficient way
- Eliminate surplus costs
