Our Top Savings Tips To Secure A Home Loan

Ready to buy your first home but unsure how to save enough to get a loan?

With a clear plan and some discipline, you can make meaningful progress towards a deposit and improve your chances of loan approval.

Higher interest rates, fierce competition and casual spending habits can make saving for a home feel out of reach. But these challenges are manageable with the right approach and realistic expectations.

Start with a strict budget.

A practical, well-followed budget is the foundation of saving for a home. Lenders typically prefer borrowers who can meet at least a 20% deposit, though other options exist.

Remember to include all up-front costs when you’re planning, such as stamp duty, conveyancing, searches and registrations, building and pest inspections, and insurance.

With Australia’s median house price above $600,000, total savings needs can easily exceed $100,000 once deposit and purchase costs are combined.

You can also make saving automatic by directing a fixed portion of your pay into a high-interest savings account. Let the balance grow and avoid withdrawing from it unless absolutely necessary.

Some helpful resources for budgeting:

• Budgeting 101
• How to successfully create family budget

Tackle existing debt.

Reducing or clearing outstanding debts can make a big difference when saving money.

Paying down credit card balances, personal loans or car finance lowers your monthly commitments and improves your serviceability in the eyes of lenders.

Reducing debt takes time, but it is an important part of strengthening your borrowing position.

Cut non-essential spending.

Short-term sacrifices make long-term gains.

Trimming discretionary expenses, such as takeaways, frequent dining out, premium subscriptions and impulse purchases, can free up substantial funds for your deposit.

Ask yourself whether a purchase now is worth delaying home ownership.

Consider Lenders Mortgage Insurance (LMI).

If saving a 20% deposit is difficult, Lenders Mortgage Insurance can let you borrow with as little as five per cent deposit. LMI protects the lender if you default, so there is a premium to pay. That premium can usually be paid up-front or added to the loan. Talk to your broker about whether LMI is a sensible option for your circumstances.

Here are a few final pointers…

• Be realistic about timelines and savings targets.
• Automate savings so you do not rely on willpower alone.
• Get professional advice early. A mortgage broker can outline pathways, compare lenders and explain the costs involved.

Saving for a deposit is one of the smartest financial moves you can make. The sacrifices you make now help you secure a home and create long-term financial stability.

Want help building a savings plan or speaking with a mortgage broker? Get in touch with our Aintree Group Wealth team to explore your options.

This is general advice only and has not been prepared with your situation and needs in mind. For individual and personalised advice, we highly recommend that you seek out proper professional advice from your financial adviser.