Key Takeaways
- The expanded Australian Government 5% Deposit Scheme now lets eligible buyers purchase with a 5% deposit and no LMI, with income limits and place caps removed from 1 October 2025; price caps still apply by location.
- Your approved loan is usually lower than expected, because lenders test repayments at around 3% above the actual rate and shade variable income.
- Schemes like the First Home Owners Grant (FHOG), stamp duty concessions, and the First Home Super Saver Scheme (FHSS) can often be stacked, particularly on a new build.
- Budget for the deposit plus several thousand dollars in costs, and structure your loan from day one.
For most Australians, buying a first home is the largest financial commitment they will ever make, and in 2026, the path looks meaningfully different from even a year or two ago. Interest rates have recently increased from their recent lows, so borrowing power remains tighter than many buyers expect, because lenders still test your repayments at a rate well above the one you will actually pay. At the same time, the home guarantee scheme has been opened right up: the income limits and the annual cap on places were removed in late 2025, so far more buyers can now enter the market with a 5% deposit and without paying Lenders Mortgage Insurance.
That mix of steadier rates, broader government support, and still-cautious lender assessment creates both opportunity and risk. Move too slowly and rising prices can outpace your savings. Move without understanding how lenders actually think, and you can overcommit, watch an approval fall over at the last minute, or miss thousands of dollars in grants and concessions you were entitled to.
This guide walks through the entire journey in order, from the first dollar you save to the moment the keys are handed over. It explains not only what each step is, but why it works the way it does: how serviceability is calculated, why two lenders can give the same borrower very different answers, when paying LMI is the smarter move, and how the 2026 schemes fit together. The goal is to help you make decisions with clear eyes rather than simply tick boxes.
The First Home Buyer Journey at a Glance
Before getting into the details, it helps to see the whole shape of the process and roughly how long it takes. The timeline depends heavily on whether you are buying an established home or building something new, so it is worth understanding both before you commit to a path.
For an established property, most buyers should plan for a journey of around 3 to 9 months once they are ready to start looking. The broad sequence runs as follows:
- Saving your deposit (often 6 to 24 months, well before the active search begins)
- Getting pre-approval (a few days to two weeks)
- Finding and securing a property (weeks to a few months)
- Formal finance approval after a signed contract (5 to 15 business days)
- Settlement, usually 30 to 90 days after the contract is signed
Building a new home, including a house and land package, is a longer commitment. From deposit to move-in, the journey commonly spans 12 to 24 months, because land registration, council approvals, and the build itself (often 4 to 9 months) all add time. Neither path is better in the abstract; the right one depends on your budget, the grants you want to access, and how quickly you need somewhere to live.
Step 1: Saving Your Deposit
Your deposit determines not just whether you can buy, but how a lender prices and structures your loan. Understanding the thresholds that matter, and the smartest ways to reach them, is the foundation on which everything else rests.
In Australia, 20% of the purchase price is the benchmark deposit because at that level, you avoid Lenders Mortgage Insurance entirely. The reality is that 20% is a large sum. On a $650,000 home, that is $130,000, which can take many years to accumulate. The good news is that you do not have to wait for 20%. There are three main ways to buy with less:
- A 5% deposit through the Australian Government 5% Deposit Scheme Guarantee, with no LMI payable (covered in Step 2)
- A deposit of 5% to 10% with LMI added to the loan
- A guarantor arrangement, where a family member uses equity in their property as additional security
One detail many first home buyers miss is the concept of genuine savings. For many low-deposit loans, lenders want to see that at least 5% of the price has been genuinely saved by you over time, typically accumulated over a period of around three months, rather than appearing suddenly as a gift or a windfall. A parental gift can still be used, but some lenders will not count it toward the genuine savings requirement, and a steady rental history can sometimes be used as an alternative. This is exactly the kind of policy difference that varies from lender to lender, and it can decide whether you are ready to apply now or in three months.
Practical Saving Strategies
Reaching a deposit faster is usually less about dramatic sacrifice and more about structure. The approaches that tend to work best include:
- Opening a separate high-interest savings account so your deposit is ring-fenced from everyday spending
- Automating a transfer on payday, so saving happens before you have a chance to spend
- Reviewing recurring and discretionary expenses, which also matters because lenders scrutinise your living costs at application
- Using the First Home Super Saver Scheme to save tax-effectively (explained below)
The First Home Super Saver Scheme
The First Home Super Saver Scheme (FHSS) lets you make voluntary contributions into your superannuation and later withdraw them, along with associated earnings, to put toward a first home deposit. Because contributions are generally taxed at the concessional super rate rather than your full marginal rate, many savers end up with more in hand than if they had saved the same money in an ordinary account. Eligible buyers can have up to around $50,000 of voluntary contributions released. It does take planning, because contributions must be made and then formally released, so it suits buyers who are 12 months or more away from purchasing. Full details are on the Australian Taxation Office website.
Step 2: Understanding Your 2026 Government Help
The schemes available to first home buyers can shift your timeline and your upfront costs by tens of thousands of dollars, so it is worth understanding each one and, just as importantly, how they work together. The rules changed significantly in late 2025, and a surprising amount of online information is still out of date.
Australian Government 5% Deposit Scheme
This scheme previously called the Home Guarantee Scheme and administered by Housing Australia (formerly the National Housing Finance and Investment Corporation, or NHFIC), lets eligible first home buyers purchase with a 5% deposit and no Lenders Mortgage Insurance. Furthermore, eligible single parents can access the scheme with just a 2% deposit. The government guarantees the portion of the deposit you are short of the usual 20%, which is what removes the need for LMI.
From 1 October 2025, the scheme was expanded in three important ways. The previous income limits of $125,000 for singles and $200,000 for couples were removed entirely, the annual cap on places was abolished, and the property price caps were lifted to better reflect current market values. In practice, this means all eligible first home buyers can now apply regardless of income, with no need to rush before places run out. Property price caps still apply and vary by location. The current headline caps are set out below, though you should confirm the figure for your specific suburb at Housing Australia.
REPLACE WITH THE PURPLE TABLE LIKE BELOW PLEASE AND DELETE IN YELLOW.
| Location | Property price cap |
| Sydney and NSW regional centres | $1,500,000 |
| Brisbane and QLD regional centres (incl. Gold Coast, Sunshine Coast) | $1,000,000 |
| Melbourne and Geelong | $950,000 |
| Adelaide | $900,000 |
| Perth | $850,000 |
| Hobart, Canberra, Darwin and other regional areas | Lower tiers apply; confirm with Housing Australia |
A common point of confusion is who can apply jointly. The current position allows you to apply on your own or with one other person, including a partner, friend, or family member, provided you both meet the criteria. Some older guides still state that only married or de facto couples qualify, which reflects the rules before the expansion.
Eligible single parents and guardians with at least one dependent can access a separate stream that allows a deposit as low as 2%, again without LMI. This pathway recognises that saving a full deposit on a single income is far harder, and it can bring a purchase forward by years for the right buyer.
The First Home Owner Grant
The First Home Owner Grant (FHOG) is a one-off payment from your state or territory government. In most states, it now applies only to newly built homes rather than established properties, and the amount varies considerably across the country. The figures below are indicative for 2026 and should be confirmed with your state or territory revenue office, as both the amount and the eligibility conditions change from time to time.
| State or territory | Grant amount | Notes |
| New South Wales | $10,000 | New homes only |
| Victoria | $10,000 | New homes only; some regional areas may differ |
| Queensland | $30,000 | New homes; contracts signed before 30 June 2026 |
| South Australia | $15,000 | New homes only |
| Western Australia | $10,000 | New homes only |
| Tasmania | $30,000 | New homes only |
| Northern Territory | Up to $50,000 | HomeGrown Territory grant for new homes |
| Australian Capital Territory | Nil | Stamp duty concessions offered instead |
Stamp Duty Concessions
Most states and territories waive or reduce stamp duty (also called transfer duty) for first home buyers below certain price thresholds. On a typical purchase, this can be one of the single largest savings available, often worth tens of thousands of dollars, so confirming your eligibility early is well worth the effort. Thresholds and concessions differ by state, so check with your relevant revenue office.
Australian Government Help to Buy Scheme
This is the latest Australian Government Scheme offering shared equity scheme in which the government co-purchases a share of your home, reducing the amount you need to borrow. You own the home and pay no rent on the government share, but when you sell, the government receives its proportional share of the proceeds. It carries its own income and price eligibility limits, so it suits a narrower group of buyers but can be a great alternative if serviceability is a stretch when looking to buy and should be considered carefully against the alternatives.
Unlike the other schemes it is not exclusively for first home buyers but needs to be for a home not an investment property. The deposit can be as low as just 2% and the government contributes up to 30% or 40% (for new builds), towards the purchase.
How the Schemes Stack Together
The real power often comes from combining schemes. Consider a couple buying a $620,000 new home in an outer Brisbane suburb. They could use the Australian Government 5% Deposit Scheme to buy with a 5% deposit and avoid LMI, claim the Queensland First Home Owner Grant on the new build, and benefit from a stamp duty concession, while one partner used the FHSS to build their share of the deposit tax-effectively. Stacked together, these can reduce the cash needed to get into the home by a large margin. Not every combination is available in every state or on every property, which is precisely where tailored advice earns its keep.
Step 3: How Much You Can Actually Borrow
Borrowing capacity is where many first home buyers are caught off guard, because the figure a lender will approve is often lower than a simple income multiple suggests. Understanding how the assessment works lets you plan realistically and, in some cases, improve your position before you apply.
As a rough starting point, many lenders will advance somewhere around 5 to 6 times your gross annual income for an owner-occupied purchase. A borrower on $100,000 with minimal debts might therefore borrow in the region of $500,000 to $600,000. That is only a guide, though, because the real calculation, known as serviceability, is more demanding.
The Serviceability Buffer
The Australian Prudential Regulation Authority (APRA) requires most lenders to assess your ability to repay at an interest rate around 3% above the actual rate on offer. So if your loan rate is 6%, the lender tests whether you could still meet repayments at roughly 9%. This buffer exists to protect both you and the lender against future rate rises, and it is the main reason approved amounts feel conservative and lower than you may have seen with a typical loan calculator which may not take this into effect. It also means that when rates fall, borrowing capacity tends to improve, and vice versa.
What Reduces Your Borrowing Power
Lenders look well beyond your salary. The commitments and habits that quietly shrink your capacity include:
- Existing personal loan or car finance repayments
- Credit card limits, which are usually assessed at the full limit even if you owe nothing, because you could draw on them at any time. A $10,000 credit card limit will reduce your borrowing capacity by around $50,000
- Higher Education Loan Program (HELP, formerly HECS) repayments are treated as an ongoing commitment
- Buy-now-pay-later facilities and other recurring obligations
- Your assessed living expenses, which lenders benchmark and will not let you understate
A practical takeaway is that reducing or closing an unused credit card before applying can lift your borrowing capacity more than a modest pay rise would, because the full limit stops counting against you.
Income Shading and Lender Behaviour
This is where experience matters, and where two lenders can reach very different conclusions about the same borrower. Lenders rarely count variable income in full. Over time, bonuses and commissions are commonly shaded, meaning only a portion, often around 80%, is counted toward serviceability. Casual income, rental income, and some allowances are treated similarly. Policies differ on probation periods, too: some lenders will lend from your first day in a new role, while others want to see a probation period completed. The treatment of HELP debt close to being paid off, the acceptance of certain visa types, and the handling of self-employed income all vary as well. None of this is visible from a single bank’s online calculator, and it is a large part of why using a Loanworx broker who will compare across many lenders, rather than accepting the first answer, can change what you can buy.
Step 4: Getting Pre-Approval the Right Way
Pre-approval gives you a clear budget and shows agents you are a serious buyer, but it is widely misunderstood. Knowing what it is and what it is not protects you from costly missteps.
Pre-approval, also called conditional approval or approval in principle, is a lender’s assessment of how much it is willing to lend you, subject to conditions. It is not the same as unconditional approval, which only comes after you have a specific property and the lender has formally verified everything, including a satisfactory valuation. Pre-approval typically lasts around 90 days, though some lenders extend it to six months, and it can be reassessed if rates move, policies change or your circumstances change.
One technical point is worth emphasising. Every formal credit enquiry is recorded on your credit file, and several enquiries in a short window can weigh on your credit score, which lenders read as a sign of financial stress. Applying to multiple banks at once to shop around can therefore work against you. A Loanworx broker can assess your likely approval across a panel of lenders without lodging formal enquiries until you are ready to proceed, which keeps your credit file clean.
To move quickly when you find the right place, have your documents ready: identification, recent payslips and an employment letter, bank statements showing savings and spending, details of any debts, and information on the deposit and any grants you intend to use.
If you are unsure which lender will view your income, deposit, debts, or first home buyer scheme eligibility most favourably, it can help to compare your options before submitting an application. Seeking home loan support can help you understand your borrowing position, avoid unnecessary credit enquiries, and choose a loan structure that suits your goals and budget.
Step 5: The Real Cost of Buying
The deposit is only part of the cash you need. Underestimating the surrounding costs is one of the most common reasons buyers come up short at the wrong moment, so it pays to map the full picture early.
Beyond the deposit, a typical first home purchase involves the costs below. The figures are indicative ranges and vary by state, property, and lender.
| Cost | Typical range |
| Stamp duty | Often reduced or nil for eligible first home buyers under the threshold |
| Conveyancing or solicitor fees | $1,500 to $2,500 |
| Building and pest inspection | $400 to $800 |
| Loan application or establishment fees | $0 to $800 |
| Lenders Mortgage Insurance | Nil if using the Australian Government 5% Deposit Scheme otherwise variable |
| Home and contents insurance (first year) | Around $1,000 to $1,800 |
| Connection and moving costs | Around $500 to $1,500 |
| Recommended cash buffer | $3,000 or more |
As a worked example, a single buyer purchasing a $600,000 established unit using the Australian Government 5% Deposit Scheme might need a 5% deposit of $30,000, pay no LMI and no stamp duty (assuming the concession applies), and then budget roughly $5,000 to $6,000 for conveyancing, inspections, insurance, and moving, plus a sensible buffer. The lesson is to plan for the deposit plus several thousand dollars more, not the deposit alone.
When Paying LMI Can Be the Smarter Move
Lenders Mortgage Insurance protects the lender, not you, if you cannot repay the loan, and the premium rises with both the loan size and how far below 20% your deposit sits. It is easy to view LMI as simply a cost to avoid, but that is not always the right call. If you qualify for the Australian Government 5% Deposit Scheme, you can usually sidestep it altogether. If you do not, the real question is a trade-off: the cost of LMI, often added to the loan, against the risk that property prices keep rising while you spend another year or two saving to 20%.
Even if outside a government scheme, with some lenders, certain types of borrowers such as nurses, medical professionals including doctors, surgeons & dentists, or lawyers and accountants only need to put in 5% or 10% deposit. Your Loanworx broker can provide you with a full list of occupations where a smaller deposit will be acceptable and check that you meet the necessary criteria.
In a rising market, buying earlier with LMI can leave you better off than waiting, while in a flat or falling market, the calculation tilts the other way. There is no universal answer, only the one that fits your market, your timeline, and your risk tolerance.
Step 6: Finding and Assessing the Right Property
The search is the exciting part, and also where emotion can override judgment. A disciplined approach protects both your finances and your peace of mind.
Before you start inspecting, separate your non-negotiables, such as the number of bedrooms or proximity to work, from the features you would like but could compromise on. This keeps you from either dismissing good options or falling for a property that does not actually suit your needs. From there, a few habits matter most:
- Research comparable recent sales in the same area so you understand fair value and can negotiate with confidence
- Always commission a building and pest inspection; the few hundred dollars it costs is trivial against the price of discovering structural damage or termites later
- Have your conveyancer review the contract of sale before you sign, so any unusual terms or title issues are caught early
It also helps to understand how you are buying. At a private treaty sale, you can usually negotiate a finance clause and a cooling-off period into the contract. At auction, there is no cooling-off period, and the sale is unconditional on the fall of the hammer, which means your finance and inspections need to be sorted beforehand. Knowing which situation you are in changes how much risk you are carrying when you make an offer.
You may also benefit from using a Buyers Agent to help you source and negotiate on a suitable property and can sometimes access off market properties so you are ahead of the competition. Your Loanworx broker has access to various specialists that can help you secure that next purchase.
Step 7: Engaging a Conveyancer or Solicitor
Conveyancing is the legal process of transferring ownership from the seller to you, and it is not something to handle alone. A licensed conveyancer or solicitor will review the contract, conduct title searches to confirm the property is free of encumbrances, liaise with the seller’s representative, coordinate with your lender, and manage settlement on your behalf.
Expect to pay somewhere in the range of $1,500 to $2,500 for a standard residential purchase. Choose someone with experience in your state, because property law and procedure differ between jurisdictions, and a small mistake here can be expensive.
Step 8: Finalising Your Finance
Once you have a signed contract, your lender moves from pre-approval to formal, unconditional approval. This stage is where a deal can quietly come undone, so it deserves close attention.
The lender will arrange a valuation of the specific property, confirming it is worth at least what you are paying. If the valuation comes in below the contract price, known as a valuation shortfall, you may need to cover the difference in cash, because the lender will only lend against its assessed value. The lender will also re-verify your income and circumstances and prepare your loan documents to sign. Worst case you Loanworx broker will look to find a new lender for you who uses a different valuer.
The single most useful piece of advice for this period is to change nothing. Do not switch jobs, take out a new loan, open a buy-now-pay-later account, or make large purchases between pre-approval and settlement. Any of these can alter your assessed position and, in the worst case, cause a lender to withdraw approval days before settlement. The timeline from formal application to unconditional approval is usually 5 to 10 business days, depending on the lender and the complexity of your file.
Step 9: Settlement Day
Settlement is the day legal ownership transfers to you, and for most buyers, it is surprisingly anticlimactic, which is exactly how it should be. In most states, it is now handled electronically through the Property Exchange Australia (PEXA) platform, so there is no in-person meeting at a titles office.
On the day your lender releases the loan funds, the purchase price is paid to the seller, the title is transferred into your name, and you receive the keys. Your conveyancer manages the mechanics and contacts you once it has been completed. In the days beforehand, you are entitled to a final inspection to confirm the property is in the same condition as when you signed and that any agreed fixtures remain. If anything is wrong, tell your conveyancer immediately so it can be resolved before settlement rather than after, when your leverage is gone. Your solicitor or conveyancer will also confirm any funds that you are required to put towards the purchase a few days before settlement.
Choosing the Right Loan Structure From Day One
How your loan is set up affects how much interest you pay and how much flexibility you have for years, yet many first home buyers give it little thought. Getting the structure right at the start is far easier than restructuring later. Your Loanworx broker can assist you with ensuring that you have the right structure from the outset.
A few decisions matter most:
- Offset versus redraw. An offset account is a transaction account linked to your loan; the balance reduces the loan interest you are charged while remaining accessible. There may be a fee for an offset account, as some lenders charge upto $400pa for this offering. A redraw facility lets you withdraw extra repayments you have made. Both can save interest, but an offset usually offers more day-to-day flexibility, while redraw can sometimes be restricted or reclassified by the lender and may not benefit tax wise if down the track your home becomes an investment property.
- Variable versus fixed. A variable rate moves with the market and typically offers more flexibility and features. A fixed rate gives certainty of repayments for a set period but limits extra repayments and can carry break costs if you wish to repay some or all of the loan within the fixed rate period. Some borrowers split their loans to get a measure of both.
- Repayment type. Owner-occupiers almost always use principal and interest repayments, which steadily reduce the loan. Interest-only is generally an investor strategy and rarely suits a first home buyer.
The point is to match the structure to how you actually manage money. A disciplined saver who keeps a healthy balance benefits more from an offset than someone who would rarely use it given there may be a fee for an offset facility.
Real First Home Buyer Scenarios
The way these pieces fit together is clearest through examples. The scenarios below are illustrative, with rounded figures, and are designed to show the logic rather than promise a specific outcome.
The Single Buyer Using the First Home Guarantee
Mia earns $95,000 and has saved $40,000. She buys a $620,000 established unit in an outer-suburban area within her city’s price cap. Using the Australian Government 5% Deposit Scheme, she puts down a 5% deposit of $31,000 and pays no LMI, with a stamp duty concession applying. Her remaining savings cover conveyancing, inspections, insurance, and a buffer. Because her income is assessed with the serviceability buffer, her Loanworx broker checks her capacity across several lenders before settling on one whose policy treats her modest HELP debt favourably.
The Couple Combining Schemes on a New Build
Sam and Alex have a combined income of $160,000. They built a $640,000 home in a growth corridor. They use the Australian Government 5% Deposit Scheme for the 5% deposit, claim their state’s First Home Owner Grant on the new build, and benefit from a stamp duty concession. One of them used the FHSS over the previous two years to build part of the deposit tax-effectively. The grants and concessions together meaningfully reduce the cash they need upfront, though they plan carefully around the longer build timeline.
The Buyer Helped by a Guarantor
Jordan has a strong income but limited savings. Rather than wait years or pay LMI, Jordan’s parents offer a limited guarantee, using equity in their home as additional security. This allows Jordan to borrow with little or no deposit and avoid LMI. The arrangement is powerful, but it is entered into only after the parents receive independent legal advice, because their property is at risk if Jordan cannot repay.
Common Mistakes and Misconceptions
Most expensive first home buyer errors come from a handful of predictable misunderstandings. Knowing them in advance is the cheapest insurance available.
- Treating pre-approval as a guarantee. It is conditional, and a poor valuation or a change in your finances can still derail it.
- Borrowing the maximum offered. Being approved for an amount is not a reason to spend it; build your own budget with room for rate rises.
- Skipping the building and pest inspection. A false economy that can hide tens of thousands of dollars in problems.
- Forgetting the surrounding costs. Stamp duty, where it applies, conveyancing, inspections, insurance, and moving all add up.
- Making large purchases before settlement. New debt taken on at the wrong moment can cause your approval to be withdrawn.
- Buying just over the price cap. Paying slightly above your scheme’s cap can cost you the entire benefit, so confirm the cap for the exact property.
- Assuming a gift counts as genuine savings. Some lenders will not treat it that way, which can delay an application.
Broker or Bank? How a Broker Actually Helps
Deciding where to get your loan is a real choice, and it is worth understanding what each path offers rather than defaulting to your existing bank. A single bank can only offer its own products and its own assessment policy. A Loanworx broker works across a panel of lenders and can match your situation to the one whose policy fits you best, which matters a great deal given how differently lenders treat income, debts, and scheme eligibility.
On cost, brokers are generally paid a commission by the lender on settlement rather than a fee by you, so their service is usually without any additional charge to the borrower. It is fair to ask how a broker is paid, and a good broker will explain this openly. Brokers also operate under a best interests duty, a legal obligation to act in your interests, and can assess your likely approval across multiple lenders without lodging formal credit enquiries until you are ready. For a first home buyer navigating grants, schemes, and varied lender policies for the first time, that breadth is where much of the value sits.
Frequently Asked Questions (FAQs)
1. How much deposit do I really need to buy my first home in 2026?
The benchmark is 20%, because that avoids Lenders Mortgage Insurance, but most first home buyers do not wait that long. You can buy with a 5% deposit and no LMI through the Australian Government 5% Deposit Scheme, with 5% to 10% by paying LMI, or sometimes with little to nothing through a guarantor arrangement or if you are employed in a particular occupation. The right level depends on your savings, your income, and how quickly you want to enter the market.
2. Do income caps still apply to the Australian Government 5% Deposit Scheme?
No. From 1 October 2025, the income limits were removed, along with the cap on the number of places. All eligible first home buyers can now access the scheme regardless of income. Property price caps still apply and vary by location, so the main constraint is the price of the home rather than what you earn.
3. Can I combine the Australian Government 5% Deposit Scheme with a grant and a stamp duty concession?
In many cases, yes. The Australian Government 5% Deposit Scheme, the First Home Owner Grant, stamp duty concessions, and the First Home Super Saver Scheme are separate measures that can often be used together, particularly on a new build. Availability depends on your state and the property, so it is worth confirming the specific combination before you commit.
4. How much can I borrow, and what reduces it?
As a rough guide, lenders often advance around 5 to 6 times your gross income, but the real assessment applies a serviceability buffer of about 3% above your actual rate. Your capacity is reduced by debts, credit card limits (assessed at the full limit), HELP repayments, buy-now-pay-later facilities, and your assessed living expenses. Reducing or closing unused credit can sometimes lift your capacity more than a small pay rise.
5. How long does the whole process take?
For an established home, budget roughly 3 to 9 months from starting your search to getting the keys: a few days to two weeks for pre-approval, weeks to months to find a property, 5 to 10 business days for formal approval after a signed contract, and a settlement period usually between 30 and 90 days. Building new takes longer, commonly 12 to 24 months, once the build and land registration are included.
6. Is it better to pay LMI and buy now, or wait to save 20%?
It depends on your market and timeline. If you qualify for the Australian Government 5% Deposit Scheme you can usually avoid LMI altogether. If you do not, weigh the cost of LMI against the risk that prices rise faster than you can save while you continue to pay rent. In a rising market, buying earlier can leave you ahead; in a flat market, waiting may cost you little. There is no single right answer, only the one that fits your situation.
7. Should I use a Loanworx mortgage broker or go straight to my bank?
A bank can only offer its own products and policies, while a Loanworx broker compares across many lenders and can match you to the one most likely to approve your situation on good terms. Brokers are generally paid by the lender rather than by you, operate under a best interests duty, and can check your prospects without harming your credit file through multiple enquiries. For most first home buyers, that breadth and guidance is valuable.
The Bottom Line
Buying your first home in 2026 is more achievable than it has been for some time, largely because the expanded Australian Government 5% Deposit Scheme has opened a 5% deposit path with no LMI to far more buyers, and because rates have steadied. The buyers who do best are not necessarily those who earn the most; they are the ones who understand how lenders assess them, plan for the full cost rather than the deposit alone, and use the schemes they are entitled to in the right combination.
Approach the journey as a sequence of informed decisions rather than a single leap. Know your real borrowing capacity, get pre-approval the right way, budget honestly, and structure your loan to suit how you manage money. Do that, and the path from your first dollar saved to settlement day becomes far less daunting and far more likely to leave you in a home you can comfortably afford to keep.
