How much deposit do first home buyers need?

There’s no single answer — but most deposits fall within a few common ranges:

  • 5% deposit – low deposit lending, higher sensitivity to lender policy
  • 10% deposit – more flexibility, reduced risk
  • 20% deposit – avoids lenders mortgage insurance (LMI) in most cases

The right deposit for you depends on your borrowing capacity, lender choice and overall financial position — not just the property price.

What counts as a deposit?

Lenders look closely at both the size and the source of your deposit.

Common sources include:

  • genuine savings (held over time)
  • gifted funds from family
  • government grants or incentives
  • equity (if applicable)
  • proceeds from asset sales

How these funds are documented and structured can determine whether they are accepted.

What is genuine savings?

Genuine savings refers to funds you have accumulated and held consistently over time, usually for at least three months.

Lenders may require:

  • a savings history showing regular accumulation
  • funds held in your account over a set period
  • evidence that the deposit is not recently borrowed

Not all lenders apply genuine savings requirements in the same way.

How lenders assess your deposit

Your deposit is assessed as part of your overall risk profile — not in isolation.

Lenders will typically consider:

  • the size of your deposit relative to the property value (LVR)
  • how the deposit has been accumulated
  • whether genuine savings requirements are met
  • your income, expenses and borrowing capacity
  • your credit history and repayment conduct
  • the type and location of the property

Different lenders take different approaches, which can significantly affect your options.

Common deposit mistakes

First home buyers often run into issues not because they lack a deposit — but because it’s not structured correctly.

Common problems include:

  • assuming a specific percentage is always required
  • not meeting genuine savings requirements
  • relying on funds lenders won’t accept
  • underestimating additional costs (stamp duty, fees)
  • focusing on deposit size without considering borrowing capacity
  • choosing a lender with restrictive deposit policies
  • not planning early enough

These issues can delay approval or limit your options.

How we structure deposits at Evolve

We focus on making sure your deposit works with your overall application.

This includes:

  • confirming how much deposit is actually required for your scenario
  • reviewing and validating your deposit sources
  • structuring savings, gifts or grants appropriately
  • identifying lenders suited to your deposit profile
  • balancing deposit size with borrowing capacity
  • advising on ways to strengthen your position
  • ensuring your deposit supports a clean, approvable application

The objective is to position your application correctly — not just meet a minimum requirement.

Speak with a broker before finalising your deposit

Getting your deposit right can materially change your borrowing options.

Before proceeding, it’s worth understanding:

  • how much deposit you actually need
  • whether your funds will be accepted
  • how your deposit affects lender choice
  • whether a different structure could improve your outcome
  • how to avoid unnecessary costs or restrictions

A well-structured deposit supports approval and flexibility. A poorly structured one can limit your options.

Speak with Evolve Lending & Finance to review your structure and next steps.