How much deposit do I need?

One of the first questions that you ask as a first home buyer is how much deposit do I need to buy a house?

The general consensus is that lenders typically look for 5% of the property price to be saved over three months from your income. This gives them the peace of mind to say that you can actually save money and that gives them the confidence to lend you money.

The 5% deposit is actually not going to cover all costs for your house purchase. This is because you have other costs involved (government stamp duty, lender’s mortgage insurance, solicitor’s fee, moving home costs and so on) that will not be included in the home loan. This means that you will need more than the 5% ‘genuine savings’ required by your lender.

If you only have the minimum 5%, then you may consider no deposit home loans or low deposit home loans where by lenders allow you to borrow with the minimum savings you have. For investors, the minimum deposit required can be anywhere between 5% and 10% of the purchase price.

Each bank has their own credit policies on how they consider your deposit. If you are unsure, please contact us on (03) 9005 3983 to see how we can help you.

About the author

Obu Ramaraj Obu Ramaraj has been a mortgage broker since 2009. She has written over $80 million dollars of loans and still maintains a personal touch to all her clients, no matter how small or big your deal is because she enjoys helping people achieve their dream of buying their own property. By sharing her knowledge and experience she hopes to instil confidence in anyone looking for a home loan. Her attention to detail and drive to achieve the best result for each and every client are enviable assets in the home loan industry. Obu is passionate about helping all home buyers feel comfortable with the property buying process; however her strongest passion is to help more people become self-assured property buyers. Her goal is to increase their financial awareness and have more people buying houses from a very early age, comfortable in the knowledge that they have made the right choice for their circumstances.