No Real Savings Loans

The more you need to borrow the higher the risk for the lender and therefore the more difficult it will be to get your loan approved. If you can prove that you have been saving towards your deposit steadily and that you will have sufficient surplus income to pay for the loan it will be easier to get the loan approved. But if you don’t have any deposit or the money for your deposit comes from somewhere other than your own savings then the lender might have some restrictions. These loans are normally called no real savings loans.

Borrowing 100% of the purchase price with no deposit is only available if you have a guarantor that can support your application. 100% home loans without a guarantor are not available from any lender in Australia.

Borrowing more than 95% of the purchase price might be available with some lenders, however your interest rates and lenders mortgage insurance rates will most probably be higher. We have calculated your insurance premium using the 95% loan-to-value-ratio rate for your loan bracket, please consider that the rates may be higher.

For self-employed borrowers the thresholds are lower, borrowing more than 80% of the purchase price might be available with few lenders at higher interest rates and higher Lenders Mortgage Insurance rates. We have calculated your insurance premium using the 80% loan-to-value-ratio rate for your loan bracket, please consider that the rates may be higher. Premium rates used in the calculation are only sample rates and may vary from lender to lender and in the future, we will keep monitoring and updating rates and alert you of any changes that could directly impact your purchase. For more information on lenders mortgage insurance click here.

Some lenders will grant you a 90%-95% loan with no genuine savings if your deposit is coming from one of these sources:

  • A gift from a family member.
  • Inheritance.
  • Advances on salary/bonuses/commissions from your employer.
  • Funds from the sale of a property or a motor vehicle.
  • One-off government payments (e.g. tax refund).
  • First Home Owners Grant (FHOG).
  • Windfall gains, unexpected gains resulting from lucky circumstances.
  • Builder or Vendor discount/finance (restrictions apply).

Getting a 95% loan without real savings will still be very difficult and you will need to meet the following conditions:

  • You must be paying your rent on time.
  • All applicants must have stable employment.
  • You must have an excellent credit score and history, free of any defaults or adverse listings and must not have too many credit enquiries.
  • You must not have many personal debts, including personal loans and credit cards (even if you always pay in full).
  • You must be able to afford all your liabilities comfortably, this is  all of your debts at a loaded interest rate and living expenses and have a 10% buffer left over.

You cannot apply for no real savings loans for the following:

  • Purchase or construction of an investment property
  • Vacant land
  • Renovations
  • Refinancing an existing mortgage
  • Debt consolidation
  • Equity release (cash out)
  • Borrowed funds such as personal loans, credit cards or loans from family (gifts are acceptable)
  • Properties exceeding 2.2 hectares

This page was last updated on 19 September 2019.