Home Loan Deposit Calculator

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Understanding Home Loan Deposits and calculating how much you need in order to get a home loan

Buying a home is the biggest financial commitment you will make in your life, so it's only natural that you're a little uncertain. One of the biggest concerns people have is often how much money they'll need to put down as a deposit and how they'll be able to get the money.

Calculate your savings

As a general rule, your home loan deposit should be 20% of the agreed-upon price of sale. This will be more if you're not planning to live in the house (if you're an investor), possibly as much as 30%. This is just the minimum deposit, though and if you've saved up enough money to put down more than 10% you should really consider doing so. It will help lower your mortgage payments and improve your long-term financial stability.

Lenders Mortgage Insurance

The majority of home loans will incur Lenders Mortgage Insurance for any deposit less than 20%.

information on Lenders Mortgage Insurance

Using the Home Loan Deposit Calculator

An easy way to figure out how much you'll need for a deposit is to use a home loan deposit calculator. A home loan deposit calculator does exactly what you'd expect: it calculates how much money you should expect to need for a deposit, based on a few different factors. It will consider variables like whether you're an owner-occupier, whether you're buying your first home and your total assets. Using the home loan deposit calculator, you'll be able to get a better idea where you stand in your savings plan for buying a home.

Of course, minimum required deposits vary from bank to bank and the amount you come up with using the home loan deposit calculator may not be the exact amount your bank requires you to pay. There are many different factors that banks consider when determining the deposit required on a home mortgage, including your credit history. Also, banks have different standards; your bank might, as a rule, require a 6% deposit from home buyers while another bank might require 5% and another 4.75%. Just as interest rates can vary a little from bank to bank, so can minimum deposit requirements.

Saving Up for Your Deposit

The important thing is to not get too worried about the minimum deposit amount you find using the home loan deposit calculator. If you've made a savings plan and are following it as best as you can, you will then be able to save up the amount needed. Stick to the plan and you'll see your deposits grow and your accounts come closer and closer to the amount the home loan deposit calculator says you should have.

Banks are also becoming a little creative in how they figure out the deposit. If you live in an apartment, your monthly rental expenses might be considered as part of the deposit (if you pay them on time and regularly). This is because a deposit isn't just about getting money up front: it's also about making sure that you're serious about buying a house and that you have the discipline to make your loan payments on time. Paying rent regularly and in full shows that you do have discipline and when added to a good savings plan, it shows how serious you are about buying your home.

As you can see, no matter how much the home loan deposit calculator shows you need, there's a way to get there.

Marc Terrano

A passionate publisher who loves to tell a story. Learning and teaching personal finance is his main lot at finder.com.au. Talk to him to find out more about home loans.

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4 Responses

  1. Default Gravatar
    PaulMay 6, 2015

    How much deposit do I need to borrow $280k to purchase a home and I have personal debit in credit card of around $18k? And what`s my chances? If I have the deposit that is or should I just pay the credit card off?

    • Staff
      MarcMay 7, 2015Staff

      Hi Paul,
      thanks for the question.

      The amount of deposit you’ll need for a property will depend on the specific home loan you choose to go with. Many lenders will require a minimum of 20% deposit without charging you LMI fees. If you’re willing to pay LMI fees, the minimum can be from 5% – 10%.

      When approving your home loan application a lender will look at all the factors of your application: your credit file, existing loans and debt, your income, and the property you’re buying.

      I hope this helps,

  2. Default Gravatar
    paulDecember 20, 2014

    To work out deposit needed do I calculate the
    Lvr for the loan

    • Staff
      ShirleyDecember 22, 2014Staff

      Hi Paul,

      Thanks for your question.

      To work out the deposit you’ll need to know the maximum LVR offered on the loan. For example, if the maximum LVR is 95% then your deposit will need to be around 5%.

      Similarly if the maximum LVR is 80% then a deposit of 20% is required.


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