How Wollongong First Home Buyers Can Use the Australian Government 5 % Deposit Scheme

Are you looking to buy your first home in Wollongong or the Illawarra region? Good news — the Australian Government’s 5 % Deposit Scheme can make home-ownership much more attainable. At Loanseek, we help local buyers navigate this pathway and secure the right home loan with confidence.

What is Australian Government 5 % Deposit Scheme?

The Australian Government 5 % Deposit Scheme allows eligible first home buyers (and some single parents/legal guardians) to purchase a home with just a 5% deposit — or only 2% for single parents/legal guardians — while avoiding Lenders Mortgage Insurance (LMI). 

Here’s how it works:

• You save the required minimum deposit (5% or 2%). 

• A participating lender backs you with the government guarantee up to 95% (or 98% for single parents/legal guardians) of the property value.

• You find and move into your home.

Why this matters for Wollongong buyers

• Smaller deposit, sooner entry: With house prices rising on the South Coast, saving 20% can be tough. The 5% scheme offers a much lower threshold.

• No waiting list & no income caps: Unlike some other schemes, you don’t need to wait in line—and there are no income limits.

• Wider choice of homes: You can buy almost any type of home (apartment, house, land) under the scheme.

• Local expertise: At Loanseek, we know the Wollongong and Illawarra property landscape—and we can help match your borrowing power with realistic homes in the region.

Are you eligible? The key criteria

To participate in the scheme you must:

• Be a first-home buyer (or eligible single parent/legal guardian).

• Have saved a minimum deposit: 5% (or 2% for single parents/legal guardians).

• Buy a property that meets the scheme’s value caps (check statewide limits).

• Work with a participating lender and meet their credit requirements.

In Wollongong, this means searching for homes you can realistically afford with a 5% deposit, and ensuring your income, savings and costs are aligned with lender guidelines.

How Loanseek can help you make this happen

1. Deposit strategy and borrowing power – We assess your finances and help you save the right amount, so you know exactly what you can borrow.

2. Lender matching for scheme access – We work with lenders who participate in the 5 % Deposit Scheme, ensuring you’re eligible for the right product.

3. Local property market insight – We bring in our Wollongong/Illawarra experience: typical house prices, suburbs with strong first-buyer potential, and what lenders favour.

4. Smooth application & approval – We assist you with paperwork (income, expenses, savings history), preparing you for a stronger home loan application.

5. Transparent cost check – With lower deposit options, it’s especially important to compare total costs (interest rate, fees, repayments). We provide a clear comparison and show you how to budget.

Common questions and answers

Can I still access other NSW first home buyer grants or stamp duty concessions?

Yes. Using the 5 % Deposit Scheme does not disqualify you from other state-based benefits (such as the NSW First Home Owner Grant or First Home Buyers Assistance). Always check latest eligibility and limits.

Is the scheme available for investment properties or just owner-occupiers?

The scheme is designed for owner-occupiers only (your home must be your principal place of residence). It’s not for investment properties.

What about loan repayments with only a 5% deposit?

You will still need to meet standard lender requirements: proof of income, serviceability (ability to repay), and reasonable living expense coverage. A higher loan-to-value ratio (LVR) might mean higher repayments or stricter lender terms — we’ll walk you through what this means in Wollongong.

How long will the pre-approval last?

It depends on the lender—but typically pre-approvals for this scheme are valid for 90 days, after which you may need to refresh the offer. We’ll help you lock things in.

Next steps – get moving with confidence

Ready to explore your first home in Wollongong? Book a free consultation with Loanseek today. We’ll:

• Assess your eligibility for the 5% Deposit Scheme

• Review your savings, income and borrowing capacity

• Help you target properties in Wollongong/Illawarra that align with the scheme

• Navigate the lender process for smooth approval

Don’t wait while the best first-home opportunities slip away. With just a 5% deposit you could be unlocking the door to your home sooner than you thought. Get in touch with our expert mortgage brokers at Loanseek today.