First Home

What Are My Deposit Options?

The first point to know is that banks won’t lend the full amount for a house (without a guarantor), so you need to come to the party with a deposit. The size and make-up of this deposit is where everyone’s situation is different, and we’ll work with you to advise the best course of action.

Whilst it’s true that 20% is the ideal deposit, there are a few options for those that can’t come up with 20%, and we have covered these off below. 

20% Deposit

Having 20% is the ideal deposit – we like to call it the sweet spot.

If you have 20% deposit, everything just becomes that little bit easier. Lenders aren’t quite as tough on servicing, you can use additional boarder income, and you can generally qualify for more lending than if you had less than 20% deposit. 

If you have a 20% deposit, schedule a call now to discuss your options, otherwise keep scrolling to see what other options may be available. 

10% Deposit

Aside from the First Home Loan Scheme, which we touch on next, 10% is the minimum requirement for purchasing a home. 

While the lending criteria is tougher, if you only have a 10% deposit there are still banks that will lend to you. It will likely mean the servicibility criteria you need to meet is stronger. Lenders will generally require you to have a higher monthly surplus in funds, to ensure you can service the loan, and be stricter on income from any boarders or flatmates.

Each bank is allowed to do 10% of its book of business on deals with less than 20% deposit. This means for every 9 loans they do with a 20% deposit, they can do 1 loan with a less than 20% deposit. 

If oyu have a 10% deposit ready to go, schedule a call and with our advice, we can help work through this with you and get you in the right position so when you are ready to apply it’s smooth sailing. 

If you don’t quite have 10% deposit, keep scrolling to see what other options may be available. 

5% Deposit

If finding a 20% (or even 10%) deposit seems out of reach, the Government (under Kāinga Ora) offers a scheme called the First Home Loan which only requires a 5% deposit. These loans are issued by selected banks and other lenders and underwritten by Kāinga Ora, and have certain criteria including an income and regional house price cap.

You can check the income cap and regional house price cap by clicking the respective links above, and like the First Home Grant you must live in the home you’re buying as well as be an NZ Citizen or Resident.

Given the recent rise in property values, the price caps for the First Home Loan are now very difficult to stay under, making the scheme less appealing to prospective home owners.

If you sound like you fit the criteria for the First Home Loan, schedule a call now to discuss your options, otherwise keep scrolling to see what other options may be available. 

No Deposit

No deposit? No worries. Welcome the bank of Mum and Dad.

A family guarantee is often made by your parent(s) or another close family member, as guarantors, to guarantee either all or the portion of a 20% deposit you haven’t been able to save.

The amount they guarantee is secured over their property, so they are using the equity in their own home rather than providing a cash payout to make up the 20% deposit.

One important point here is that your parents need to be in a stable financial position and working with a regular income, so if they are enjoying retirement they may not be eligible.

We can talk through all the ins and outs of guaranteeing a loan with you and your parents, so everyone knows how it works and any potential risks.


How Can Our Team Help You

  • First off, we’ll help you figure out how much you can afford to borrow
  • Based on this, we’ll work out where to start looking for your first home
  • We’ll work in your best interests as your personal ‘bank manager,’ comparing over 16 banks and lenders to get you a good deal and the best structure for your mortgage
  • We were working online before Covid-19 forced the point: our state-of-the-art software enables you to instantly complete an application from your own device, accepted by all lenders
  • Assist with property reports, inspections and valuations
  • We keep it simple – no question is a silly one, and we explain everything in layman’s terms, guiding you through contracts, auctions and more


Ready to get started on your home buying journey with Total Mortgages? Then it’s time to start thinking about your finances. Read on to learn more about the different options to put together your first home deposit, and your next steps towards home ownership.

Schedule a Call

Schedule a call with a home finance expert now