Question 1

How much deposit do I need for my first home?

Accepted Answer

While the traditional benchmark is 20%, you can buy with as little as 5% deposit through schemes like the First Home Guarantee. With 5-20% deposit you'll typically pay Lenders Mortgage Insurance, unless you're eligible for a Lenders Mortgage Insurance waiver or use a family guarantee.

Question 2

What is the difference between pre-approval and full approval?

Accepted Answer

Pre-approval (or conditional approval) is based on your financial position and gives you a borrowing limit before you find a property. It's usually valid for 3-6 months. Full approval happens after you've found a property and submitted the contract—the lender assesses both you and the property before final approval.

Question 3

Should first home buyers choose fixed or variable rates?

Accepted Answer

Fixed rates give you certainty and protection against rate rises for a set period (usually 1-5 years), but you might miss out if rates fall. Variable rates can go up or down and usually offer more flexibility. Many first home buyers opt for a split loan—part fixed, part variable—to get the benefits of both.

Question 4

What is Lenders Mortgage Insurance?

Accepted Answer

Lenders Mortgage Insurance is an insurance policy that protects the lender if you can't repay your loan. It's typically required when you borrow more than 80% of the property value. Some first home buyers can avoid it through the First Home Guarantee scheme or professional Lenders Mortgage Insurance waivers.

Question 5

How does the First Home Guarantee scheme work?

Accepted Answer

The First Home Guarantee allows eligible first home buyers to purchase with as little as 5% deposit without paying Lenders Mortgage Insurance. The government guarantees up to 15% of the property value to participating lenders. From 1 October 2025, place limits and income caps were removed entirely, and property price caps were increased — for example, to $1,500,000 in Sydney and $1,000,000 in Brisbane and the ACT.

Question 6

What are the upfront costs of buying a first home?

Accepted Answer

Beyond your deposit, budget for stamp duty, lender application fees, building and pest inspections, conveyancing/legal fees, Lenders Mortgage Insurance if applicable, home insurance, moving costs, and ongoing costs like council rates, strata fees, and maintenance. A good rule of thumb is 5-7% of the purchase price.

Question 7

Can I use my super to buy my first home?

Accepted Answer

Yes, through the First Home Super Saver Scheme (FHSSS). You can make voluntary contributions to your super (up to $15,000 per year, $50,000 total) and later withdraw these plus earnings to use toward your deposit.

Question 8

What is a family guarantee loan?

Accepted Answer

A family guarantee allows a family member to use the equity in their property as additional security for your loan. This means you can borrow with a smaller deposit (sometimes 0%) and avoid Lenders Mortgage Insurance. The guarantor isn't liable for your repayments—they're just providing security.

Question 9

How long does it take to buy your first home?

Accepted Answer

From pre-approval to settlement typically takes 8-12 weeks. Pre-approval can be done in 3-5 business days. Once you find a property and your offer is accepted, you'll usually have a 30-60 day settlement period.

Question 10

Do I need a mortgage broker or can I go direct to a bank?

Accepted Answer

You can do either, but a broker gives you access to 60+ lenders on our panel (not just one bank), can often negotiate better rates, and handles the paperwork. Our service has no upfront fees — we're paid by the lender. For first home buyers especially, having someone find the right fit from hundreds of products is invaluable.

Question 11

What documents do I need for a first home loan application?

Accepted Answer

Typically you'll need ID, proof of income, bank statements (3-6 months), details of assets and liabilities, employment letter, and proof of savings. Self-employed applicants may need additional tax documents and financials.

First Home Buyer Hub — Your Complete Guide to Buying Your First Home

Government Grants & Schemes

First Home Buyer Calculator

The Home Buying Journey

First Home Buyer FAQ

Home Loan Options

Expert Articles

Contact Pendium Finance