First Home Buyer Loans and Rates Australia 2026

At the time of writing, the lowest variable rate for first home buyers on our database starts from 5.89%. To qualify The lowest rates require a 20% deposit and clean credit history.

Yes, you can buy a first home with a 5% deposit, but your options change how much the loan will cost you.

• With the First Home Guarantee: Eligible buyers can secure a loan with a 5% deposit and completely avoid LMI. The federal government guarantees the remaining 15% of the deposit.
• Without the Guarantee: You can still get a 5% deposit loan through many lenders, but you will typically have to pay LMI. This insurance protects the lender, not you, and can add thousands of dollars to your upfront costs.

Grants don't directly lower your mortgage interest rate, but they can increase your effective deposit, which reduces your LVR and may qualify you for a lower rate tier.

No credit history is not the same as bad credit. Most lenders will consider your application, though you may face a smaller lender panel. A mortgage broker can identify which lenders assess thin-file applicants most favourably.

A 20% deposit can help you avoid Lenders Mortgage Insurance (LMI), but it's not always necessary. Depending on your circumstances, it may be possible to buy a home with a much smaller deposit.

Some common options include:

• First-home buyers: Buy with as little as a 5% deposit through the Home Guarantee Scheme, subject to eligibility requirements.
• Single parents and legal guardians: Buy with as little as a 2% deposit through the Family Home Guarantee, subject to eligibility requirements.
• Guarantor home loans: A family member may use equity in their property as additional security, helping you buy with a smaller deposit.
• Gifted deposits: Some lenders accept genuine savings supplemented by a financial gift from an eligible family member.
• Professional packages: Certain lenders offer reduced deposit requirements for eligible professionals, such as medical and healthcare workers.

The deposit you'll need depends on the property's value, your financial situation, lender requirements and the pathway you choose. It's also important to budget for upfront costs such as stamp duty, legal fees and moving expenses.

LMI is a one-off insurance premium charged when your deposit is below 20%. It protects the lender, not you—and typically costs $5,000–$18,000 depending on loan size.

The First Home Guarantee is an Australian Government scheme that allows eligible first-home buyers to purchase a property with as little as a 5% deposit without paying Lenders Mortgage Insurance (LMI). The government guarantees part of the loan, reducing the lender's risk.

Eligibility criteria apply, including income thresholds of $125,000 for individuals and $200,000 for joint applicants. Since late 2025, the scheme has operated on a demand-driven basis rather than being restricted by annual place caps, although eligibility requirements and property price caps still apply.