Compare low deposit home loans

The table below displays low deposit home loans (loan-to-value ratios of 85% and above) from Canstar’s Online Partners.

GM, Research
Editor-in-Chief
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promoted
Fees & charges apply. Australian Credit Licence 395219.
5.54%
Variable
5.58%
$2,852
Principal & Interest
dot
Available for purchase or refinance, min 10% deposit
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Fast turnaround times to meet tight settlement timeframes
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No application, ongoing or monthly fees.
Owner occupied
10% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 395219.
Fees & charges apply. Australian Credit Licence 395219.
promoted
Fees & charges apply. Australian Credit Licence 496431.
5.54%
Variable
5.55%
$2,852
Principal & Interest
Owner occupied
10% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 496431. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 496431. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 395219.
5.54%
Variable
5.58%
$2,852
Principal & Interest
Owner occupied
10% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 395219. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 395219. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 236476.
4.99%
3 year fixed
5.75%
$2,681
Principal & Interest
Owner occupied
5% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 236476. Star Rating for a $500k owner occupier 3 year fixed rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 236476. Star Rating for a $500k owner occupier 3 year fixed rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 237391.
5.79%
Variable
5.85%
$2,931
Principal & Interest
Owner occupied
10% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 237391. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 237391. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 238311.
5.30%
2 year fixed
5.38%
$2,777
Principal & Interest
Owner occupied
5% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 238311. Star Rating for a $500k owner occupier 2 year fixed rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 238311. Star Rating for a $500k owner occupier 2 year fixed rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 496431.
5.29%
2 year fixed
5.50%
$2,773
Principal & Interest
Cashback
Cashback
Owner occupied
10% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 496431. Star Rating for a $500k owner occupier 2 year fixed rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 496431. Star Rating for a $500k owner occupier 2 year fixed rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 395219.
5.49%
Variable
5.95%
$2,836
Principal & Interest
Owner occupied
10% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 395219. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 395219. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 230686. Products issued by ubank, part of NAB.
5.99%
Variable
6.01%
$2,995
Principal & Interest
Owner occupied
15% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 230686. Products issued by ubank, part of NAB. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 230686. Products issued by ubank, part of NAB. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 230686. Products issued by ubank, part of NAB.
5.62%
1 year fixed
6.19%
$2,877
Principal & Interest
Owner occupied
15% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 230686. Products issued by ubank, part of NAB. Star Rating for a $500k owner occupier 1 year fixed rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 230686. Products issued by ubank, part of NAB. Star Rating for a $500k owner occupier 1 year fixed rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 238139.
5.79%
1 year fixed
7.90%
$2,931
Principal & Interest
Owner occupied
5% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 238139. Star Rating for a $500k owner occupier 1 year fixed rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 238139. Star Rating for a $500k owner occupier 1 year fixed rate P+I loan at 80% LVR

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The initial results in the table above are sorted by Star Rating (High-Low) , then Comparison rate^ p.a. (Low-High) , then Provider Name (Alphabetical) . Additional filters may have been applied, which impact the results displayed in the table - filters can be applied or removed at any time.

promoted
Fees & charges apply. Australian Credit Licence 237391.
Interest rate p.a.
Comparison rate^ p.a.
Monthly repayment
5.54%
Variable
5.57%
$2,852
Principal & Interest
IMB Bank Budget Home Loan
Enjoy up to $4,000 cashback when you switch your eligible home loan to IMB Bank. Terms and Conditions Apply
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Low Rate Home Loan
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Apply online in minutes!
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Canstar's Most Satisfied Customers - Bank - 2022
Fees & charges apply. Australian Credit Licence 237391. See Terms & Conditions. ^ Comparison Rate Warning. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 237391. See Terms & Conditions. ^ Comparison Rate Warning. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR

About low deposit home loans

A low deposit home loan may be appealing if you want to get into the property market as soon as you can. But a low deposit may mean that you end up paying more in the long run.

What is a low deposit home loan?

A low deposit home loan is generally considered to be anything under 20% of the purchase price. This includes loans that have a loan-to-value ratio (LVR) greater than 80%. The LVR is the loan amount expressed as a percentage of the value of the property you’re buying. So the bigger your deposit, the lower your LVR will be, and vice versa – a 95% LVR will have a 5% deposit.

Lenders generally like you to have at least a 20% deposit, and if it is anything less, you may have to pay Lender’s Mortgage Insurance (LMI). This is to protect the lender if you get into a situation where you default on the loan. But if you’re a first home buyer, you may be eligible for government incentives and schemes aimed at making home ownership more achievable. Examples of these include the First Home Guarantee or Regional First Home Buyer Guarantee. These grants allow a limited number of eligible (first home) borrowers each financial year to get a home loan with as little as a 5% deposit, without needing to pay LMI.

Frequently Asked Questions about low deposit home loans

Not everyone will be eligible for a low deposit home loan. The assessment criteria can vary depending on your lender and personal situation, but you’ll need to meet some of the below conditions:

  • A good credit history.
  • Stable employment.
  • Genuine savings.
  • High income compared to the loan amount.
  • Own other assets.
  • Low or no other debts (e.g. credit cards, personal loans).

If you make an application for a low deposit home loan, you will need to demonstrate that you are capable of making the monthly repayments. You will also generally need to have a high credit score with a history of consistent repayments on any loans and credit cards you’ve taken out. That means a low deposit home loan may not be suitable for those who are struggling financially.

Lenders may be hesitant to offer low deposit home loans for large mortgages; which means that home buyers looking for a higher-end property may not necessarily be well-suited to a low deposit home loan. But if you’re looking to invest in a second property, you may be able to use your existing property’s equity instead of a deposit.

It could be a good idea to compare potential lenders to see who offers the best deal that suits your needs. You might also consider seeking some independent financial advice or approaching a mortgage broker who may be able to help.

Canstar has budgeting and saving tips that may help you save for that 20% deposit, if you decide to keep saving for a larger deposit.

If you’re a first home buyer (or re-entering the property market after 10 years) you may be eligible for a low deposit home loan through one of the Australian government’s Home Guarantee Scheme (HGS):

  • First Home Guarantee supports eligible home buyers to purchase a home sooner with a deposit as low as 5%.
  • Family Home Guarantee supports eligible single parents or legal guardians to buy a home sooner with a deposit as low as 2%.

The HGS is a national scheme, but each state and territory has their own separately funded grants for eligible first home owners. First Home Buyer Grants provide a one-off lump sum payment, which can be used to contribute to your deposit, LMI, settlement fees, or any other charges related to your home loan. To apply, you must be able to show that you have committed to buying or building a home – which means you’re not able to utilise this grant if you’re still in the early stages of your purchasing journey.

Learn more: Australia’s First Home Owner Grants and concessions: how do they work?

Lenders mortgage insurance (LMI) is an insurance policy that protects the lender from financial loss if the borrower can’t afford to meet their home loan repayments. This does not protect the borrower and should not be confused with mortgage protection insurance.

Generally, lenders will require you to take out LMI if your home loan deposit is less than 20% of the total property value. LMI is typically paid upfront or added to (called ‘capitalised into’) your home loan. The actual cost will depend on a range of factors but generally, the lower your deposit, the more expensive the LMI will be.

However, different lenders will have different rules, so it’ll be worth checking each individual lender’s policy. Lenders may also waive the LMI for certain professions, such as teachers or doctors. You may also be able to avoid paying for LMI if you’re eligible for one of the government’s Home Guarantee Schemes.

Explore further: How much is lenders mortgage insurance?

The potential pros and cons to consider if you’re thinking of applying for a low deposit home loan:

Pros:

  • You can buy and own a home sooner without waiting to save up for a larger deposit.
  • Not needing to save for a long period means you avoid the possibility of house prices rising higher than when you first started saving.
  • A low deposit home loan can be more appealing to those working in professions where their LMI can be waived.

Cons:

  • You’re borrowing more money from a lender, which means you’ll be paying more in interest over time.
  • With a larger LVR, your repayments will be higher as you will need to pay it by the end of the loan term, unless you refinance your home loan. You may be able to reduce the total interest you pay if you can change the frequency of your mortgage repayments.
  • You may need to pay LMI, which can be expensive. You could generally pay this up front or add it to your home loan, but that will increase your home loan repayments and contribute to the interest you pay overtime.
  • Some lenders may charge higher interest or other fees for low deposit loans.

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About the authors

Nina Rinella, Editor-in-Chief

Nina Rinella
As Canstar’s Editor-in-Chief, Nina heads up a team of talented journalists committed to helping empower consumers to take greater control of their finances. Nina has written countless articles about finance and has been interviewed on finance topics by media organisations including The Australian, Realestate.com.au, Domain, the Herald Sun and the Sydney Morning Herald. Previously Nina founded her own agency where she provided content and communications support to clients around Australia for 8 years. She also spent four years as the PR Manager for American Express Australia, and has worked at a Brisbane communications agency where she supported dozens of clients, including Sunsuper and Suncorp. When she’s not dreaming up ways to put a fresh spin on finance, she’s taking her own advice by trying to pay her house off as quickly as possible and raising two money-savvy kids. Nina has a Bachelor of Journalism and a Bachelor of Arts with a double major in English Literature from the University of Queensland. She’s also an experienced presenter, and has hosted numerous events and YouTube series. You can follow her on LinkedIn and Canstar on Facebook. Meet the Canstar Editorial Team. Have a media enquiry, and interested in featuring Nina as a financial expert and commentator? Contact Canstar’s Media Team today.

Joshua Sale, GM, Research

Joshua Sale

As Canstar’s Ratings Manager, Josh Sale is responsible for the methodology and delivery of Canstar’s Home Loans Star Ratings and Awards and the Home Loan Refinance Awards. With tertiary qualifications in economics and finance, Josh has worked behind the scenes for the last five years to develop Star Ratings and Awards that help connect consumers with the right home loan for them.

Josh is passionate about helping consumers get hands-on with their home loans, always reminding home buyers that finding the right loan can be as important for your finances as negotiating a fair property purchase price. Josh has been interviewed by media outlets such as the Australian Financial Reviewnews.com.au and Money Magazine, discussing topics including home loan equity and wider finance trends.

When it comes to Josh’s own property journey, the home loans expert once bought two houses in the same transaction when he ensured the cubby house his daughter loved was listed on the purchase contract for his new home.

You can follow Josh on LinkedIn, and Canstar on Twitter and Facebook.


Important information

For those that love the detail

This advice is general and has not taken into account your objectives, financial situation or needs. Consider whether this advice is right for you.

Canstar may earn a fee from its Online Partners for referrals from its website tables, and from sponsorship or promotion of certain products. Fees payable by product providers for referrals and sponsorship or promotion may vary between providers, website position, and revenue model. Sponsorship/promotion fees may be higher than referral fees. If a product is sponsored or promoted, it’s an ad and it is clearly marked as such. An ad might appear in different places on our website, such as in comparison tables and articles. Ads may be displayed in a fixed position in a table, regardless of the product's rating, price or other attributes. The location of an ad doesn’t indicate any ranking or rating by Canstar. Payment of fees for ads does not influence our Star Ratings. See How We Get Paid to find out more. Payment of fees for ads does not influence our Star Ratings or Awards.

Home loan Star Ratings are updated daily. During periods of significant market fluctuations, such as adjustments to the reserve bank's cash rate, star rating updates will be paused for variable home loans until the market has stabilised. However, advertised interest rates of products will continue to be updated as advised by lenders. The results don’t include every provider in the market and we may not compare all features relevant to you. Current rates and fees are displayed and may be different to what was rated. You can find a description of the initial sort order below the table. You can use the sort buttons at the top of each column to re-order the display. Learn more about our Home Loans Star Rating Methodology. The rating shown is only one factor to take into account when considering products. The table defaults to display only home loans available to somebody borrowing up to 80% of the property value, but you can use the filters to change this. Similar products might have different features and fees depending on the amount you borrow. Contact the lender for details.

The products and Star Ratings in the table might not match your exact inputs in the selector. Sometimes the methodology uses profiles with categories or bands (e.g. income, loan amount or monthly spend), but sometimes a single methodology, without any categories or bands, is applied.  The results will show the products that most closely match your selection, based on our profiles. If you are unsure about any terms used in the comparison table please refer to the glossary.

What is a Target Market Determination?

A Target Market Determination (‘TMD’) is a document that explains which people particular financial products may be suitable for (the target market) and sets out any conditions around how financial products can be distributed to consumers.

Why do product issuers provide Target Market Determinations?

From 5 October 2021, TMDs are compulsory for most financial products.

Issuers and distributors of financial products must take reasonable steps that are likely to result in financial products reaching consumers in the target market defined by the product issuer.

We recommend that you consider the TMD before making a purchase decision. Contact the product issuer directly for a copy of the TMD.

Any advice on this page is general and has not taken into account your objectives, financial situation or needs. Consider whether this general financial advice is right for your personal circumstances. Canstar provides information about credit products. We’re not suggesting or recommending a particular credit product for you. If you decide to apply for a loan, you will deal directly with the provider, not with Canstar. Consider the Target Market Determination (TMD) before making a purchase decision. Contact the product issuer directly for a copy of the TMD. It’s important you check rates and product information directly with the provider. For more information, read our Detailed Disclosure. ^Read the Comparison Rate Warning.

Canstar is not providing a recommendation for your individual circumstances. We cannot and do not recommend that any particular product is suitable for you. 

We provide links to our Online Partners. These are brands that may pay Canstar a fee for referring you. Our tables default to display only our Online Partners’ products initially, you can adjust the Online Partner Filter to see all of the products available for comparison on Canstar’s website. We provide these links so that you can click through to the product provider’s website to get more information. The provision of these links does not constitute a recommendation by Canstar.

Before you elect to terminate or modify existing lending arrangements, we recommend you consider (i) your personal circumstances, and (ii) any associated fees, exit costs and application costs that may be applicable as well as the impact these changes could have on you. We suggest you consider seeking independent advice from a qualified adviser.

“Interest-only loan” generally means a loan where you will only pay interest during the interest-only term. That means you won’t be making payments which reduce debt during the interest-only term.