Loan for House Deposit? Here's How to Secure It (2026)

For many Australians, the dream of owning a home remains just that—a dream. One of the most significant hurdles is amassing a sufficient deposit. But what if you could secure a loan to cover your house deposit? This idea might sound unconventional, but it's a feasible option for some. Let’s explore how you can navigate this path to homeownership.

Understanding Loans for House Deposits

Traditionally, a house deposit requires saving a substantial amount of money over time. However, with property prices soaring, saving a 20% deposit in 2026 can be daunting. A deposit loan can bridge the gap, enabling you to enter the property market sooner. This type of loan essentially covers the upfront cost, reducing the immediate financial burden.

Current Market Rates and Requirements

As of 2026, interest rates for personal loans in Australia, which can be used for house deposits, range between 6.49% and 12%. The rates vary depending on your credit score, the loan amount, and the lender's policies. At Esteb and Co, we work with over 83 lenders, providing a broad spectrum of options to suit diverse financial situations.

Generally, lenders require a good credit history and a stable income to qualify for a deposit loan. Some might also need additional security, such as a guarantor or collateral. Here’s a comparison table to give you an overview:

Loan Type	Interest Rate	Requirements
Personal Loan	6.49% - 12%	Good credit score, stable income
Guarantor Loan	5.75% - 10%	Guarantor required, flexible income requirements
Secured Loan	5% - 9%	Collateral needed, lower interest rates

Steps to Secure a House Deposit Loan

Securing a loan for a house deposit involves several steps:

1. Assess Your Financial Situation: Review your income, expenses, and existing debts. Ensure you're in a stable financial position to handle additional loan repayments.
2. Check Your Credit Score: Obtain your credit report and address any issues. A higher score increases your chances of securing a favourable interest rate.
3. Research Lenders: Explore different lenders across Esteb and Co's network of 83+ lenders. Compare their terms, interest rates, and eligibility criteria.
4. Gather Documentation: Prepare necessary documents such as proof of income, identification, and credit history.
5. Apply for the Loan: Submit your application through your chosen lender. Ensure all information is accurate and complete.
6. Review Loan Offer: Carefully review the loan offer terms and conditions before acceptance.
7. Use the Loan Wisely: Once approved, use the funds strictly for your house deposit to avoid financial pitfalls.

Tips and Considerations

Before proceeding with a deposit loan, consider the following expert advice:

• Understand the Risks: Taking a loan for a deposit means additional debt. Ensure you can manage repayments alongside a mortgage.
• Explore All Options: Consider alternatives such as family assistance, co-buying, or government grants that might reduce or eliminate the need for a deposit loan.
• Plan for the Long Term: Calculate the total cost of borrowing, including interest, and ensure it aligns with your long-term financial goals.
• Consult a Financial Adviser: Before making a decision, consult with a financial expert to ensure it's the right move for your circumstances.

Frequently Asked Questions

1. Can I get a home loan without a deposit? In some cases, lenders offer options such as guarantor loans, where a family member's property serves as security, allowing you to bypass a deposit.
2. Are there any government schemes to assist with deposits? Yes, the First Home Owner Grant and First Home Loan Deposit Scheme can provide financial assistance for eligible buyers.
3. What is the minimum deposit required for a home loan in 2026? Typically, lenders require at least 5% of the property's value, though a 20% deposit is standard for avoiding Lenders Mortgage Insurance (LMI).
4. Is it advisable to use a personal loan for a house deposit? It can be risky due to the additional debt. It's crucial to ensure you're financially stable enough to manage multiple repayments.
5. How does a guarantor loan work? A guarantor loan requires a family member to offer their property as security, reducing the risk for the lender and potentially lowering your interest rate.
6. What are the risks of borrowing for a deposit? Increased debt levels, higher overall interest costs, and potential difficulty in managing repayments if your financial situation changes.
7. Can Esteb and Co assist with finding the right deposit loan? Absolutely, with access to over 83 lenders, we can help you find a loan that matches your needs and financial situation.