What Makes a First Home Buyer Loan Different? | QLoans.au

Buying your first home can feel confusing — especially when you’re told “first home buyer loans are different”.

The First Home Guarantee (part of the Australian Government 5% Deposit Scheme) allows eligible first home buyers to purchase a home with a deposit as low as 5% without paying Lenders Mortgage Insurance (LMI).

Key Features & Benefits

• Low Deposit: Start with just a 5% deposit, significantly reducing the time needed to save.
• No Income Caps: As of late 2025/2026, there are no income restrictions for this scheme.
• No LMI Fees: The Government guarantees the gap (up to 15%), saving you thousands in upfront insurance costs.
• Property Choice: Valid for houses, townhouses, apartments, house/land packages, off-the-plan, or building on vacant land.
• Unlimited Spots: No more waitlists or annual quotas; you can apply whenever you are ready.

Eligibility Criteria

To access the scheme, you must:

• Be an Australian citizen or permanent resident (18+ years old).
• Be a first home buyer (or have not owned property/land in Australia in the last 10 years).
• Have a minimum 5% deposit saved.
• Purchase a property at or below the location’s price cap.
• Intend to live in the home as an owner-occupier.
• Apply individually or jointly with one other person (partner, friend, or family member).

How to Apply

1. Check Eligibility: Use the online tool on the website.
2. Contact a Participating Lender: Applications are made through authorized banks/lenders, not directly to the government.
3. Find a Home: Once pre-approved, you have 90 days to find a property under the price cap and sign a contract.
4. Move In: Your lender manages the final approvals and settlement.

Ongoing Obligations

You must continue to live in the property as an owner-occupier to maintain the government guarantee. If you move out or change the loan’s purpose, you may become liable for LMI or other additional costs.