How much deposit do I need to buy a house in QLD?
Calculating exactly how much deposit you will need to buy a house in QLD should always be done by a professional, however you can use this guide as a starting point. Most people will only need a 5% deposit + costs (usually about $3,000 for a first home buyer), please refer to the costs of buying a house in QLD.
The main exceptions to using a 5% deposit in QLD are displayed below. Please note: "5%" or "20%" always refers to the purchase price of the property (or valuation if it is lower); so a 5% deposit when buying a $400,000 house would be $20,000.
| A 5% deposit home loan is generally available to: |
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| An applicant with a reliable income sufficient to make the loan repayments. |
| Australian Permanent Residents. |
| Full-time, part-time or casual (generally 1 year) employees. |
| Applicants that are self employed need to have been trading for 24 months, or been working as PAYG for 24 months prior to starting their own business. |
| Situations where you would need more than a 5% deposit: |
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| If you've been self employed for less than 2 years. Refer to self employed home loan requirements for specific details. |
| If you have bad credit: generally more than 1 or 2 defaults will require 10% deposit or more. |
| When buying an usual property: common examples are high density apartments in Brisbane CBD, or properties over 5 acres. |
| If you don't meet Lenders Mortgage Insurance's criteria, you may require a 20% deposit. |
| If you are not a permanent resident of Australia. |
How will contributing a larger home loan deposit benefit me?
Using the minimum allowable deposit is a great option for many people to get into the housing market without saving a large deposit; however, if you have more funds available, there are distinct advantages for using a larger home loan deposit:
- 0% Deposit: Can only be done using equity in a guarantor's property. See how a guarantor works for more information.
- 0% - 5% Deposit: Without a guarantor, the only way to purchase with under 5% is by purcahsing a brand new house (or constructing) using the First Home Owner's Grant as part of your deposit. This is possible, however can be a little tricky, contact us to find out how.
- 5% Deposit: The absolute minimum cash deposit required to buy a house in QLD.
- 8% Deposit: To account for the Lenders Mortgage Insurance Premium, most major and second tier banks will require approximately 8% as a deposit. Using an 8% deposit will generally get you a much cheaper interest rate than at 5%.
- 10% Deposit: Some lenders will not lend above 90% of the value of the property (90% LVR). Having a 10% deposit will open these lenders up to you and could mean you get a better deal. Lender's Mortgage Insurance Premiums are also much less with a 10% home loan deposit.
- 15% Deposit: Many banks will accept "non-genuine savings" at 85% LVR, so this is often a good figure if you are using a gift from your parents as a deposit.
- 20% Deposit: The magic number. Whilst some banks will reduce interest rates at lower LVRs, having a 20% deposit will usually get you the best deal out there. You also will not need to pay a Lender's Mortgage Insurance Premium, and will be subject to less strict approval criteria in general.
TLDR; How much deposit do I need in QLD?
Usually 5% of the purchase price. Talk to a Mortgage Broker in QLD to check your eligibility etc. We can do all checks and lodge the application on your behalf and don't charge any fees - if you found this information useful we would really appreciate you giving us a call.
DISCLAIMER: You must not rely on the information in the report as an alternative to financial advice from an appropriately qualified professional. If you have any specific questions about any financial matter you should consult an appropriately qualified professional. We do not represent, warrant, undertake or guarantee that the use of guidance in the report will lead to any particular outcome or result. The content, calculations and opinions contained in this article are of the writer only, and are not necessarily those of Blue Fox Finance.