10% Down Home Loan? Secure Your Dream Home Fast (2026)
Worried about high down payments? Discover how a 10% deposit can still get you approved. Explore options now and step closer to your new home.
You're dreaming of owning your own home but are unsure if you can secure a home loan with just a 10% deposit. The good news is, in 2026, it's entirely possible to make that dream a reality. With the right information and strategies, you can navigate the home loan process even with a smaller deposit. Let's dive into what you need to know to move forward confidently.
Understanding Home Loans with a 10% Deposit
Buying a home is a significant milestone, and understanding how home loans work with a smaller deposit is crucial. A 10% deposit means you’ll need to borrow 90% of the property’s value, which lenders often refer to as the Loan-to-Value Ratio (LVR). In Australia, lenders typically prefer an LVR of 80% or less, but many will consider loans with a higher LVR, albeit with some additional requirements and costs.
In 2026, the property market continues to be competitive, and the ability to secure a loan with a 10% deposit opens doors for many Australians who might otherwise struggle to save the traditional 20%. Understanding the dynamics of LVR, lender’s mortgage insurance (LMI), and available options is essential to successfully obtaining a home loan with a 10% deposit.
Current Rates, Requirements, and Options
As of 2026, interest rates in Australia for home loans range from approximately 6.49% to 12%, depending on the lender and your financial profile. With a 10% deposit, you may face slightly higher rates and additional costs, such as LMI, which protects the lender if you default on the loan.
Eligibility criteria generally include a stable income, a good credit history, and the ability to demonstrate a capacity to meet repayments. Lenders may have specific requirements, such as proof of genuine savings or a low debt-to-income ratio.
| Lender | Interest Rate Range | Special Requirements |
|---|---|---|
| Bank A | 6.49% - 8.5% | Genuine savings required |
| Lender B | 7% - 9.5% | Higher LMI costs |
| Credit Union C | 7.5% - 10% | Flexible income verification |
With access to over 83 lenders, Esteb and Co can help you find a lender that suits your needs, even with a smaller deposit. Our broad panel ensures that you have a variety of options to choose from, enhancing your chances of securing a favourable loan.
Steps to Secure a Home Loan with a 10% Deposit
Securing a home loan with a 10% deposit involves several key steps:
- Evaluate Your Financial Situation: Start by assessing your income, expenses, and savings. Calculate how much you can realistically afford to borrow and repay.
- Improve Your Credit Score: A good credit score can increase your chances of loan approval and help you secure better interest rates.
- Save for LMI: With a higher LVR, prepare for the possibility of LMI, which may add to your upfront costs.
- Seek Pre-approval: Obtain pre-approval from a lender to understand how much you can borrow and show sellers you’re a serious buyer.
- Consult with a Mortgage Broker: Leverage the expertise of Esteb and Co's brokers to identify the best loan options from our extensive lender panel.
- Submit Your Application: Once you find the right property and lender, complete your loan application with the necessary documentation.
- Finalise the Loan: Upon approval, review the loan agreement carefully and prepare for settlement.
Tips and Considerations
Here are some expert tips to consider when pursuing a home loan with a 10% deposit:
- Consider First Home Buyer Schemes: If you're a first-time buyer, explore government grants and schemes that may offer financial assistance or reduce LMI costs.
- Explore Family Guarantee Options: Some lenders offer loans where a family member’s property acts as additional security, potentially reducing your LVR and LMI requirements.
- Negotiate Loan Terms: Don't hesitate to negotiate interest rates and LMI costs with your lender. Your mortgage broker can assist with this process.
- Plan for Additional Costs: Budget for stamp duty, legal fees, and moving costs, which are separate from your deposit and loan.
- Stay Informed: Keep up with market trends and interest rate changes to ensure you're making informed decisions.
Frequently Asked Questions
1. Can I avoid paying LMI with a 10% deposit?
While paying LMI is common with a 10% deposit, options like a family guarantee or specific lender policies may help you avoid it.
2. How does a 10% deposit affect my interest rate?
A higher LVR may lead to slightly higher interest rates, but your credit score and financial profile also play significant roles.
3. Are there any government assistance programs for first-time buyers?
Yes, programs like the First Home Owner Grant and First Home Loan Deposit Scheme may provide financial assistance or LMI relief.
4. What documentation do I need for a 10% deposit loan application?
You’ll need proof of income, genuine savings, identification, and details of any existing debts or liabilities.
5. Can I refinance later to eliminate LMI costs?
Yes, refinancing once your equity increases may help you avoid ongoing LMI costs. Consult with a mortgage broker for guidance.
Embarking on the journey to homeownership with a 10% deposit is achievable with the right approach and guidance. By understanding your options and working with a skilled mortgage broker like Esteb and Co, you can make informed decisions and take confident steps towards owning your dream home.
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With direct experience helping Australians secure home loans, car finance, and business funding, Ricky founded Esteb and Co to bring transparency and technology to mortgage broking.