If your lender needs a 20% deposit (as calculated by the LVR) and you can’t come up with the required amount, you still have a few options: Lenders Mortgage Insurance (LMI). This is an insurance policy which protects the lender from financial losses arising from a borrower’s failure to meet home loan repayments. If the lender repossesses the property because of repayment default, then sells it, and the sale price achieved is less than the outstanding loan amount, the lender can recover the remaining balance via the insurance policy. The borrower must pay the LMI premium, but the cost can often be added to the loan amount and repaid over time. Loan guarantor. Another option is to have your mortgage repayments guaranteed by another person. This will usually be a close family member, such as one or both of your parents. They will need to own a property themselves (or have a large amount of equity in it) because the lender will require a charge over their property as additional security for your loan. It is not something to be undertaken lightly by the guarantor, because if you default on your repayments the lender will seek to recover any losses from the guarantor. In extreme cases this could mean that the lender enforces a sale of the guarantor’s property in order to recover its losses. First Home Loan Deposit Scheme (FHLDS). The federal government will guarantee up to 10,000 low deposit home loans per year, meaning that borrowers can avoid either paying LMI or asking a family member to act as guarantor. An additional 10,000 loan guarantees specifically for newly-built homes were made available for the financial year ending 30th June 2021. See details at the National Housing Finance and Investment Corporation. First Home Owner Grant. Some Australian state and territory governments offer first-home-buyer grants, varying state-by-state at the time of writing from $10,000 to $25,000. The grant may be added to your existing savings in order to fulfil the lender’s deposit requirements. There are different eligibility rules in each state, and in some states you will need to be buying a brand new property rather than an established one. Some states have other concessions available to first-time buyers. These may include stamp duty concessions and LMI insurance duty concessions. Check with your local state government for the details that apply to your situation.