Your home loan deposit represents your financial input towards the property you intend to purchase.
Consistent savings deposited into an account over several months, consistent rental payments, and investments collectively provide lenders with an indication of your capacity to manage your home loan repayments.
The deposit you possess at the time of applying for your home loan can affect the interest rate offered by lenders. A larger deposit typically provides you with more negotiating leverage and a wider selection of lenders.
The smaller the amount you borrow, the less you’ll need to repay in the future. Consequently, over the duration of your home loan, you’ll also incur less interest expenses.
Real savings refer to funds deposited into an account for a minimum of three months. Lenders consider genuine savings as proof that you can consistently make payments, indicating your ability to manage home loan repayments.
Consistently making deposits isn’t the sole indicator of genuine savings. Lenders also consider the following as evidence of genuine savings: term deposits maintained for at least three months, shares held for at least three months, gifted funds held in an account for at least three months, inheritance funds held in an account for at least three months, and equity in a current property.
As house prices continue to rise steadily, it’s increasingly common for parents and relatives to assist their children in entering the property market by providing a monetary gift. When a family member gifts money, lenders seek evidence that it is indeed a ‘gift’ and that no repayment is expected.
Some lenders accept rental history as genuine savings if you’re still renting, have 12+ months of records from one place, and rent through a real estate agent. But not all lenders do.
Family Security Guarantee allows family to use the equity in their home to support your loan helping you fast track your purchase, and reduce your costs involved. With this strategy, you can buy with as little as 0% deposit, and retain full ownership of your property. It’s ideal for first-home buyers or investors with limited savings but strong income. Talk to one of our team to see if this is something that can work for your needs.
Home Buying costs FAQ
Construction costs
If you’re building a new home or undertaking a major renovation, a construction loan is designed to support the process by releasing funds in stages as the work progresses.
What Is a Construction Loan?
Unlike a standard home loan, a construction loan is drawn down in parts—called progress payments—to match the stages of construction. You only pay interest on the amount that has been drawn, which helps manage cash flow during the build.
Typical Progress Payment Stages:
Deposit – Paid to the builder before construction begins
Base – Covers the foundation or slab
Frame – Funds the frame and structure
Enclosed – For roofing, windows, and external walls
Fixing – Includes internal fittings and finishes
Practical Completion – Final payment after the build is complete
Why Choose a Construction Loan?
You avoid paying interest on the full loan amount upfront
Payments align with work completed, offering more protection
Suitable for building from scratch or completing a house-and-land package
Costs to Consider:
Builder’s deposits and progress payments
Site preparation and connection of utilities
Council permits and inspections
Interest and fees during construction
Lender’s valuation at each stage
When building a property, two important upfront expenses that often catch buyers off guard are site costs and service connection costs. These are essential to get your block of land ready for construction and to connect it to vital infrastructure.
Site Costs
Site costs refer to the work required to prepare the land for building. These can vary greatly depending on the condition and slope of your block.
Typical site costs include:
Soil testing and engineering reports
Excavation or levelling of the land
Retaining walls (if required)
Rock removal or difficult soil handling
Drainage and erosion control
These costs are often classified as fixed or provisional in your building contract, but it’s crucial to understand exactly what’s included. Site costs can range from $10,000 to $30,000 or more, depending on complexity.
Service Connection Costs
These are the fees involved in connecting your property to essential services such as:
Water
Electricity
Gas
NBN or phone line
Sewerage
Some estates include these in the land price, while others do not. Service connection costs can add another $5,000 to $15,000+, especially in regional or newly developed areas.
Purchase costs
When buying a property, one of the essential costs to factor in is conveyancing or solicitor fees. This covers the legal side of the transaction and ensures that your property purchase is secure, compliant, and fully protected.
What is Conveyancing?
Conveyancing is the legal process of transferring ownership of a property from the seller to the buyer. It includes reviewing contracts, conducting title searches, checking for any outstanding debts on the property, and handling settlement.
What Do the Fees Cover?
Reviewing and preparing legal documents
Property title and council searches
Managing the exchange of contracts
Arranging settlement with all parties involved
Ensuring legal ownership is correctly transferred
How Much Does It Cost?
Depending on the complexity of the purchase and the professional you choose, conveyancing or solicitor fees typically range from $1,000 to $2,500. It’s an upfront cost, but a critical one—especially when investing in high-value assets.
Before finalising any property purchase, it’s strongly recommended to arrange pest and building inspections. These inspections help you understand the true condition of the property and avoid costly surprises after settlement.
What Does a Building Inspection Cover?
A licensed inspector checks the structural integrity of the property, looking for issues such as:
Cracks in walls or foundations
Roof and plumbing problems
Poor drainage or water damage
Compliance with building standards
What Does a Pest Inspection Cover?
A pest inspection looks for signs of infestation or damage caused by termites, borers, and other timber pests that can seriously impact the value and safety of the property.
Why Is It Important?
These inspections provide peace of mind and negotiation power. If problems are found, you may be able to renegotiate the purchase price or request repairs before settlement.
Cost Range
Combined building and pest inspections typically cost between $400 and $800, depending on the property size and location.
Home Loan Education
