Many first home buyers believe they need a 20% deposit before speaking to a mortgage broker. A larger deposit can absolutely help, but it is not the only pathway into the market.

The deposit you need depends on the lender, the property type, your income, your credit position, whether you have genuine savings, whether lenders mortgage insurance applies and whether you are eligible for any government schemes.

A 20% deposit is often seen as the traditional benchmark because it generally reduces lender risk and may help avoid lenders mortgage insurance. But many buyers enter the market with less. Some lenders may consider applications with a lower deposit where the overall position is strong. Government-backed guarantee schemes may also assist eligible buyers to purchase with a smaller deposit without paying lenders mortgage insurance.

That does not mean a small deposit is always the best answer. The lower your deposit, the more important the rest of the application becomes. Lenders will look closely at your income stability, employment type, existing debts, living expenses, credit conduct, savings history and the type of property being purchased.

Genuine savings can also matter. Some lenders want to see that part of the deposit has been saved over time, rather than fully gifted or borrowed. Other lenders may take a more flexible view depending on rent history, family assistance or the overall strength of the application.

Buyers also need to plan for costs beyond the deposit. These may include conveyancing, building and pest inspections, bank fees, government charges, transfer duty where applicable, moving costs, insurance and initial setup expenses. In newer growth areas such as Pimpama, Coomera and Ormeau, buyers purchasing house and land packages should also consider build deposits, progress payment timing, valuation risk and construction loan requirements.

Family support can sometimes help. A guarantor loan may allow eligible buyers to purchase with a smaller cash deposit by using limited security support from a family member. This can help reduce or avoid lenders mortgage insurance, but it must be structured carefully. The guarantor needs to understand the risk and the exit strategy.

Government schemes may also reduce the deposit burden. The Australian Government 5% Deposit Scheme is designed to help eligible first home buyers buy with a smaller deposit and avoid lenders mortgage insurance. The First Home Super Saver Scheme may help eligible buyers save for a deposit through voluntary super contributions. Queensland grants and concessions may reduce upfront costs for eligible buyers, particularly where the home is new or being built.

The practical question is not simply: how little deposit can I use? The better question is: what deposit level gives me a safe, realistic and lender-friendly approval pathway?

At Viewpoint Finance Group, we help first home buyers compare deposit pathways and understand the full cost of buying before making an offer. That includes the loan deposit, extra costs, scheme eligibility, lender policy and the amount of money you should keep aside after settlement.

A deposit gets you started, but good structure keeps you comfortable after you move in.

Frequently Asked Questions

Is a 20% deposit required to buy a first home?

No. It is a strong benchmark but not always required. Lower deposit options may be available depending on eligibility and lender policy.

What are genuine savings?

Genuine savings generally refers to money saved and held over time. Each lender applies its own policy.

Should I use all my savings as the deposit?

Not always. Keeping a cash buffer for settlement costs, moving costs and emergencies is important.