Find and compare 95% LVR home loans

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2.34%

Fixed - 2 years

2.70%

Adelaide Bank

$1.3k

Redraw facility
Offset Account
Borrow up to 94.9999%
Extra Repayments
Interest Only
Owner Occupied

2.17

/ 5
More details

2.79%

Fixed - 5 years

3.87%

NAB

$1.4k

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

2.82

/ 5
More details

2.29%

Fixed - 1 year

2.34%

G&C Mutual Bank

$1.3k

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

2.05

/ 5
More details

2.45%

Variable

2.50%

Illawarra Credit Union

$1.3k

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

3.49

/ 5
More details

2.40%

Fixed - 3 years

2.60%

Illawarra Credit Union

$1.3k

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

3.38

/ 5
More details

2.59%

Fixed - 1 year

2.62%

G&C Mutual Bank

$648

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

1.21

/ 5
More details

2.59%

Variable

2.63%

Easy Street Financial Services

$1.4k

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

3.28

/ 5
More details

2.59%

Variable

2.64%

Illawarra Credit Union

$1.4k

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

3.19

/ 5
More details

2.65%

Fixed - 1 year

2.65%

Illawarra Credit Union

$1.4k

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

3.09

/ 5
More details

2.65%

Fixed - 2 years

2.65%

Illawarra Credit Union

$1.4k

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

3.06

/ 5
More details

2.64%

Variable

2.66%

BankSA

$1.4k

Redraw facility
Offset Account
Borrow up to 94.9999%
Extra Repayments
Interest Only
Owner Occupied

3.11

/ 5
More details

2.64%

Variable

2.66%

G&C Mutual Bank

$1.4k

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

3.19

/ 5
More details

2.80%

Fixed - 1 year

2.66%

Illawarra Credit Union

$700

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

2.91

/ 5
More details

2.44%

Fixed - 3 years

2.70%

Adelaide Bank

$1.3k

Redraw facility
Offset Account
Borrow up to 94.9999%
Extra Repayments
Interest Only
Owner Occupied

2.53

/ 5
More details

2.69%

Variable

2.71%

Bank of Melbourne

$1.4k

Redraw facility
Offset Account
Borrow up to 94.9999%
Extra Repayments
Interest Only
Owner Occupied

2.99

/ 5
More details

2.69%

Variable

2.71%

St.George Bank

$1.4k

Redraw facility
Offset Account
Borrow up to 94.9999%
Extra Repayments
Interest Only
Owner Occupied

2.99

/ 5
More details

2.29%

Intro 24 months

2.72%

Westpac

$1.4k

Redraw facility
Offset Account
Borrow up to 95%
Extra Repayments
Interest Only
Owner Occupied

3.29

/ 5
More details

2.23%

Fixed - 1 year

2.73%

Adelaide Bank

$1.3k

Redraw facility
Offset Account
Borrow up to 94.9999%
Extra Repayments
Interest Only
Owner Occupied

1.71

/ 5
More details

2.64%

Fixed - 5 years

2.73%

Adelaide Bank

$1.4k

Redraw facility
Offset Account
Borrow up to 94.9999%
Extra Repayments
Interest Only
Owner Occupied

2.92

/ 5
More details

2.64%

Fixed - 4 years

2.74%

Adelaide Bank

$1.4k

Redraw facility
Offset Account
Borrow up to 94.9999%
Extra Repayments
Interest Only
Owner Occupied

2.59

/ 5
More details

Learn more about home loans

When you decide to enter the property market and take out a home loan, it’s important to understand all the ins and outs of mortgages. It’s highly likely that you won’t have enough money to buy a property outright, so you will probably need to take out a home loan.

However, the type of home loan you choose, the deposit you can put down and the most attractive offer you can find depends on your financial standing and a number of other factors. Before you visit a lender or broker, it’s advisable to conduct some research so you know what your options are.

Have a look at our guide to 95 per cent LVR home loans to get your head wrapped around them before you take the plunge.

What is a 95% LVR home loan?

A 95 per cent LVR home loan is a type of low-deposit home loan for which you are only required to have 5 per cent of the total property’s value to put towards a deposit.

‘LVR’ is an acronym for loan-to-value ratio, which refers to the amount you are borrowing, represented as a percentage of the value of the property being used as security for the loan. When a lender looks at how much you want to borrow, they will look at the deemed value of the property against how much of a deposit you can put down. That’s why a 95 per cent LVR home loan only requires a 5 per cent down payment.

Many standard home loans require a 20 per cent deposit, but there are other types of home loans available. They include 70 per cent LVR home loans, 90 per cent LVR home loans and 95 per cent LVR home loans.

What are the benefits of 95% LVR home loans?

Some of the potential advantages of taking out a 95 per cent LVR home loan include:

Entering the property market quickly – Because you only need a 5 per cent deposit, you can take out a loan and buy a home faster than waiting to save the standard 20 per cent deposit.

Easing short-term financial pressures – If you want to a buy a home but saving a lump sum for a deposit isn’t feasible in the short term, a 95 per cent LVR home loan could temporarily relieve some of the financial burden.

Taking advantage of low interest rates – You could be able to enter the property market when favourable interest rates are available even if you don’t have enough for a standard deposit.

What are the drawbacks of 95% LVR home loans?

As with all loan options, there are also some potential disadvantages to 95 per cent high LVR home loans:

Lender’s mortgage insurance – 95 per cent LVR home loans often come with lender’s mortgage insurance (LMI), which offers protection to the lender – not you – if you default on the loan. LMI can be hefty, so you’ll need to consider if the cost is worth it.

Borrowing more money – Because you’re only putting down a 5 per cent deposit, you’ll be borrowing 95 per cent of the property’s value, which could mean higher monthly repayments and a longer loan term than with a standard 80 per cent LVR home loan.

Rates could rise – Even if you enter the property market quickly to secure a favourable interest rate, those rates could change at any time (except for during fixed rate periods).

Features of 95% LVR home loans

Home loans with a 95 per cent LVR typically have similar features to other types of home loans, but the associated rates and fees may differ. For example, a lender might choose to offer a more favourable interest rate to customers who can put down a larger deposit.

Aside from the interest rate and deposit amount, though, here are some of the other common features to consider:

  • Fixed rate or variable rate – You can usually decide whether to lock in an interest rate for a set period or have a variable interest rate.
  • Repayment options – Some lenders will allow you to make additional repayments above the minimum, so you can pay off your loan faster and avoid interest.
  • Redraw facility – Some home loans come with the option to redraw additional repayments you’ve made if you need the money down the track.
  • Offset account – You may be able to have a bank account linked to your home loan, known as an ‘offset account’. Your lender attributes your account balance towards your loan so you only have to pay interest on the difference.
  • Loan term – Usually, the term for a home loan is 25-30 years.

Consider speaking with a financial adviser to discuss your situation before sitting down with a lender or mortgage broker. You can also use RateCity’s home loan comparison tool to see what’s currently available in the market.

Frequently asked questions

What are the pros and cons of no-deposit home loans?

It’s no longer possible to get a no-deposit home loan in Australia. In some circumstances, you might be able to take out a mortgage with a 5 per cent deposit – but before you do so, it’s important to weigh up the pros and cons.

The big advantage of borrowing 95 per cent (also known as a 95 per cent home loan) is that you get to buy your property sooner. That may be particularly important if you plan to purchase in a rising market, where prices are increasing faster than you can accumulate savings.

But 95 per cent home loans also have disadvantages. First, the 95 per cent home loan market is relatively small, so you’ll have fewer options to choose from. Second, you’ll probably have to pay LMI (lender’s mortgage insurance). Third, you’ll probably be charged a higher interest rate. Fourth, the more you borrow, the more you’ll ultimately have to pay in interest. Fifth, if your property declines in value, your mortgage might end up being worth more than your home.

Does Australia have no-deposit home loans?

Australia no longer has no-deposit home loans – or 100 per cent home loans as they’re also known – because they’re regarded as too risky.

However, some lenders allow some borrowers to take out mortgages with a 5 per cent deposit.

Another option is to source a deposit from elsewhere – either by using a parental guarantee or by drawing out equity from another property.

What is a loan-to-value ratio (LVR)?

A loan-to-value ratio (otherwise known as a Loan to Valuation Ratio or LVR), is a calculation lenders make to work out the value of your loan versus the value of your property, expressed as a percentage.   Lenders use this calculation to help assess your suitability for a home loan, and whether you need to pay lender’s mortgage insurance (LMI). As a general rule, most banks will require you to pay LMI if your loan-to-value ratio is 80 per cent or more.   LVR is worked out by dividing the loan amount by the value of the property. If you are looking for a quick ball-park estimate of LVR, the size of your deposit is a good indicator as it is directly proportionate to your LVR. For instance, a loan with an LVR of 80 per cent requires a deposit of 20 per cent, while a 90 per cent LVR requires 10 per cent down payment. 

LOAN AMOUNT / PROPERTY VALUE = LVR%

While this all sounds simple enough, it is worth doing a more accurate calculation of LVR before you commit to buying a place as there are some traps to be aware of. Firstly, the ‘loan amount’ is the price you paid for the property plus additional costs such as stamp duty and legal fees, minus your deposit amount. Secondly, the ‘property value’ is determined by your lender’s valuation of the property, not the price you paid for it, and sometimes these can differ so where possible, try and get your bank to evaluate the property before you put in an offer.

What is a low-deposit home loan?

A low-deposit home loan is a mortgage where you need to borrow more than 80 per cent of the purchase price – in other words, your deposit is less than 20 per cent of the purchase price.

For example, if you want to buy a $500,000 property, you’ll need a low-deposit home loan if your deposit is less than $100,000 and therefore you need to borrow more than $400,000.

As a general rule, you’ll need to pay LMI (lender’s mortgage insurance) if you take out a low-deposit home loan. You can use this LMI calculator to estimate your LMI payment.

How much deposit will I need to buy a house?

A deposit of 20 per cent or more is ideal as it’s typically the amount a lender sees as ‘safe’. Being a safe borrower is a good position to be in as you’ll have a range of lenders to pick from, with some likely to offer up a lower interest rate as a reward. Additionally, a deposit of over 20 per cent usually eliminates the need for lender’s mortgage insurance (LMI) which can add thousands to the cost of buying your home.

While you can get a loan with as little as 5 per cent deposit, it’s definitely not the most advisable way to enter the home loan market. Banks view people with low deposits as ‘high risk’ and often charge higher interest rates as a precaution. The smaller your deposit, the more you’ll also have to pay in LMI as it works on a sliding scale dependent on your deposit size.

Will I have to pay lenders' mortgage insurance twice if I refinance?

If your deposit was less than 20 per cent of your property’s value when you took out your original loan, you may have paid lenders’ mortgage insurance (LMI) to cover the lender against the risk that you may default on your repayments. 

If you refinance to a new home loan, but still don’t have enough deposit and/or equity to provide 20 per cent security, you’ll need to pay for the lender’s LMI a second time. This could potentially add thousands or tens of thousands of dollars in upfront costs to your mortgage, so it’s important to consider whether the financial benefits of refinancing may be worth these costs.

How much can I borrow with a guaranteed home loan?

Some lenders will allow you to borrow 100 per cent of the value of the property with a guaranteed home loan. For that to happen, the lender would have to feel confident in your ability to pay off the mortgage and in the security provided by your guarantor.

What is a credit limit?

The maximum amount that can be borrowed from a lender, as per the home loan contract.

How do I take out a low-deposit home loan?

If you want to take out a low-deposit home loan, it might be a good idea to consult a mortgage broker who can give you professional financial advice and organise the mortgage for you.

Another way to take out a low-deposit home loan is to do your own research with a comparison website like RateCity. Once you’ve identified your preferred mortgage, you can apply through RateCity or go direct to the lender.

Who has the best home loan?

Determining who has the ‘best’ home loan really does depend on your own personal circumstances and requirements. It may be tempting to judge a loan merely on the interest rate but there can be added value in the extras on offer, such as offset and redraw facilities, that aren’t available with all low rate loans.

To determine which loan is the best for you, think about whether you would prefer the consistency of a fixed loan or the flexibility and potential benefits of a variable loan. Then determine which features will be necessary throughout the life of your loan. Thirdly, consider how much you are willing to pay in fees for the loan you want. Once you find the perfect combination of these three elements you are on your way to determining the best loan for you. 

How do I know if I have to pay LMI?

Each lender has its own policies, but as a general rule you will have to pay lender’s mortgage insurance (LMI) if your loan-to-value ratio (LVR) exceeds 80 per cent. This applies whether you’re taking out a new home loan or you’re refinancing.

If you’re looking to buy a property, you can use this LMI calculator to work out how much you’re likely to be charged in LMI.

How do I refinance my home loan?

Refinancing your home loan can involve a bit of paperwork but if you are moving on to a lower rate, it can save you thousands of dollars in the long-run. The first step is finding another loan on the market that you think will save you money over time or offer features that your current loan does not have. Once you have selected a couple of loans you are interested in, compare them with your current loan to see if you will save money in the long term on interest rates and fees. Remember to factor in any break fees and set up fees when assessing the cost of switching.

Once you have decided on a new loan it is simply a matter of contacting your existing and future lender to get the new loan set up. Beware that some lenders will revert your loan back to a 25 or 30 year term when you refinance which may mean initial lower repayments but may cost you more in the long run.

What happens to my home loan when interest rates rise?

If you are on a variable rate home loan, every so often your rate will be subject to increases and decreases. Rate changes are determined by your lender, not the Reserve Bank of Australia, however often when the RBA changes the cash rate, a number of banks will follow suit, at least to some extent. You can use RateCity cash rate to check how the latest interest rate change affected your mortgage interest rate.

When your rate rises, you will be required to pay your bank more each month in mortgage repayments. Similarly, if your interest rate is cut, then your monthly repayments will decrease. Your lender will notify you of what your new repayments will be, although you can do the calculations yourself, and compare other home loan rates using our mortgage calculator.

There is no way of conclusively predicting when interest rates will go up or down on home loans so if you prefer a more stable approach consider opting for a fixed rate loan.

Does Australia have no cost refinancing?

No Cost Refinancing is an option available in the US where the lender or broker covers your switching costs, such as appraisal fees and settlement costs. Unfortunately, no cost refinancing isn’t available in Australia.

Can I change jobs while I am applying for a home loan?

Whether you’re a new borrower or you’re refinancing your home loan, many lenders require you to be in a permanent job with the same employer for at least 6 months before applying for a home loan. Different lenders have different requirements. 

If your work situation changes for any reason while you’re applying for a mortgage, this could reduce your chances of successfully completing the process. Contacting the lender as soon as you know your employment situation is changing may allow you to work something out. 

Can I get a home loan if I am on an employment contract?

Some lenders will allow you to apply for a mortgage if you are a contractor or freelancer. However, many lenders prefer you to be in a permanent, ongoing role, because a more stable income means you’re more likely to keep up with your repayments.

If you’re a contractor, freelancer, or are otherwise self-employed, it may still be possible to apply for a low-doc home loan, as these mortgages require less specific proof of income.

Is there a limit to how many times I can refinance?

There is no set limit to how many times you are allowed to refinance. Some surveyed RateCity users have refinanced up to three times.

However, if you refinance several times in short succession, it could affect your credit score. Lenders assess your credit score when you apply for new loans, so if you end up with bad credit, you may not be able to refinance if and when you really need to.

Before refinancing multiple times, consider getting a copy of your credit report and ensure your credit history is in good shape for future refinances.

I have a poor credit rating. Am I still able to get a mortgage?

Some lenders still allow you to apply for a home loan if you have impaired credit. However, you may pay a slightly higher interest rate and/or higher fees. This is to help offset the higher risk that you may default on your repayments.

I can't pick a loan. Should I apply to multiple lenders?

Applying for home loans with multiple lenders at once can affect your credit history, as multiple loan applications in short succession can make you look like a risky borrower. Comparing home loans from different lenders, assessing their features and benefits, and making one application to a preferred lender may help to improve your chances of success

Will I be paying two mortgages at once when I refinance?

No, given the way the loan and title transfer works, you will not have to pay two mortgages at the one time. You will make your last monthly repayment on loan number one and then the following month you will start paying off loan number two.