5% Deposit Scheme for ADF Members
Explore the 5% Deposit Scheme for ADF Members to Secure Your Home
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The 5% deposit scheme available to ADF members is the First Home Guarantee (FHBG), which is part of the Australian Government's Home Guarantee Scheme (HGS). It is administered by Housing Australia and is available to all eligible first home buyers in Australia, not exclusively to ADF members. Under the scheme, Housing Australia provides a guarantee to a participating lender, allowing the borrower to purchase a property with a deposit as low as 5% without paying Lenders Mortgage Insurance (LMI). The guarantee covers up to 15% of the property value, bridging the gap between the borrower's deposit and the 20% threshold at which LMI would otherwise apply. The guarantee protects the lender, not the borrower. It is not a cash payment, a grant, or a deposit contribution.
The Australian Government expanded the Home Guarantee Scheme significantly from 1 October 2025. The changes, confirmed by Housing Australia, include the removal of annual place limits (previously capped at 35,000 per year for the FHBG), meaning all eligible first home buyers who meet the criteria can now apply without competing for a limited number of places. Income caps have been removed. Previously, the scheme was limited to individual applicants with a taxable income at or below $125,000 or joint applicants at or below $200,000. This cap no longer applies from 1 October 2025. Property price caps were increased across all states and territories. The Regional First Home Buyer Guarantee (RFHBG) was replaced by the First Home Guarantee, simplifying access for buyers in regional areas. The scheme is now available through over 30 participating lenders.
To be eligible for the First Home Guarantee, applicants must be Australian citizens or permanent residents, at least 18 years of age, and must be a first home buyer or a buyer who has not owned property in Australia in the past 10 years as at the home loan date. The property must be purchased as an owner-occupied residence, not an investment. The home loan must be principal and interest from a participating lender, for a term of up to 30 years (plus up to three years for construction). Applicants can apply individually or jointly with a partner, friend, or family member (maximum two applicants). The deposit must be between 5% and 20% of the property value.
The borrower is responsible for all costs and repayments associated with the home loan, including stamp duty, application fees, and legal costs. The guarantee does not cover these costs.
The property price caps that apply under the Home Guarantee Scheme from 1 October 2025 are as follows.
New South Wales capital city and regional centres: $1,500,000. New South Wales other areas: $800,000. Victoria capital city and regional centres: $950,000. Victoria other areas: $650,000. Queensland capital city and regional centres: $1,000,000. Queensland other areas: $700,000. Western Australia capital city: $850,000. Western Australia other areas: $600,000. South Australia capital city: $900,000. South Australia other areas: $500,000. Tasmania capital city: $700,000. Tasmania other areas: $550,000. Australian Capital Territory: $1,000,000. Northern Territory: $600,000. Jervis Bay Territory and Norfolk Island: $550,000. Christmas Island and Cocos (Keeling) Islands: $400,000.
The property value is assessed by the participating lender and may differ from the purchase price. Eligible property types include existing houses, townhouses and apartments, house and land packages, vacant land with a separate contract to build, and off-the-plan apartments or townhouses.
The Family Home Guarantee (FHG) is a separate guarantee within the Home Guarantee Scheme that allows eligible single parents or single legal guardians with at least one dependent child to purchase a home with a deposit as low as 2%. Under the FHG, Housing Australia guarantees up to 18% of the property value. The same property price caps apply. Applicants do not need to be first home buyers but must not have any other property interest once their new home settles. From 1 October 2025, the FHG also has unlimited places and no income caps. For ADF members who are single parents, this guarantee may allow entry into the property market with a smaller deposit than the FHBG.
ADF members apply for the Home Guarantee Scheme through a participating lender. Applications cannot be made directly to Housing Australia. A mortgage broker accredited with one or more of the participating lenders can submit the application on the borrower's behalf, assess whether the FHBG or FHG suits the borrower's situation, and compare the participating lender's product terms against other options available outside the scheme. Because the scheme requires principal and interest repayments and owner-occupier status, and because the guarantee is tied to the specific lender and loan product, the choice of participating lender affects both the interest rate and the loan features available to the borrower.
The Home Guarantee Scheme can be used alongside state and territory first home buyer grants and stamp duty concessions. ADF members may also be eligible for the Defence Home Ownership Assistance Scheme (DHOAS), which provides monthly subsidy payments toward a home loan. Whether DHOAS and the Home Guarantee Scheme can be used on the same loan depends on the participating lender and whether they are also an approved DHOAS provider. A broker familiar with both programs can assess whether the two can be combined or whether one provides a more favourable outcome than the other depending on the borrower's LVR, income, and property circumstances.
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Milan Holly
I couldn’t recommend Azura Financial highly enough. Ben, Nick and Ray were absolutely fantastic from start to finish. I had actually already arranged to work with another broker, but after my first conversations with Ben, I was so impressed with his approach, knowledge and level of service that I decided to switch to Azura Financial, and I’m extremely glad I did. The entire process was incredibly smooth. Ben, Nick and Ray were always responsive, helpful and patient, kept me updated throughout every stage, and made what could have been a stressful process feel straightforward and well managed. Whenever I had a question or needed assistance, they were there. What impressed me most was the genuine level of care and attention they provided. I never felt like just another client — the service was professional, personal and consistently excellent. I will definitely use Azura Financial again in the future and would have absolutely no hesitation recommending Ben, Nick and Ray to my friends, family or anyone looking for a great mortgage broker. Thank you, guys, for making the whole experience such a positive one. Truly outstanding service from beginning to end!
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Thea Edwards
Nick and the team were so lovely. Professional, genuine, responsive and easy to deal with. Would highly recommend.
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simon preshaw
Nick and the team were a pleasure to work with. They answered all of my questions and if they weren't immediately available, they were always quick to call me back.
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Alannah Paige
I am a first home buyer and had Carl as my mortgage broker. He worked diligently to follow up any issues or questions I had and made the process as smooth as it could. I highly recommend! Thank you Carl.
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sarah ander
As a first home buyer, Carl and the team at Azura were incredibly helpful throughout the whole process. They made everything feel straightforward and were always there to answer any questions along the way. I’ve already recommended them to friends and would highly recommend them to anyone looking to get a mortgage!
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Shaun Cunningham
As a founder, getting a mortgage requires a couple more hoops to jump through, which is why I couldn't recommend Nick O'Sullivan and the Azura team more highly. Not only were they able to offer a seamless process, but Nick was also patient with us as we changed our minds about when to buy (over a period of years!). The truth is anyone can approach a bank and get a mortgage, but when things don't go perfectly (e.g. abrupt government changes), that's when you want a pro on your team like Nick.
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Van Tran
Nick and the team at Azura Financial exceeded our expectations at every step. Their guidance was clear, their expertise was evident, and they handled every financial detail with care — giving us complete peace of mind throughout the process. We couldn't have asked for a better team by our side. Thank you very much, V&V.
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Philip Woods
Carl and team were absolutely impressive with their attentiveness to answering questions no matter how stupid they were. The urgency they put into attending to timelines and requests was superb. I would recommend them without hesitation.
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Nick was amazing to work with. He's easygoing, quick to reply, and genuinely a very competent broker. He made my loan possible and secured a great deal for me. Highly recommend:)
The 5% deposit scheme is the First Home Guarantee (FHBG), part of the Australian Government's Home Guarantee Scheme administered by Housing Australia. It is not specific to ADF members. It is available to all eligible first home buyers in Australia. Under the scheme, Housing Australia provides a guarantee to a participating lender, allowing the borrower to purchase with a deposit of 5% without paying Lenders Mortgage Insurance (LMI). The guarantee covers up to 15% of the property value. From 1 October 2025, the scheme has unlimited places, no income caps, and increased property price caps. Borrowers must be Australian citizens or permanent residents, at least 18 years of age, and must be a first home buyer or not have owned property in Australia in the past 10 years.
From 1 October 2025, the property price caps under the Home Guarantee Scheme are: New South Wales capital city and regional centres $1,500,000, other NSW areas $800,000; Victoria capital city and regional centres $950,000, other VIC areas $650,000; Queensland capital city and regional centres $1,000,000, other QLD areas $700,000; Western Australia capital city $850,000, other WA areas $600,000; South Australia capital city $900,000, other SA areas $500,000; Tasmania capital city $700,000, other TAS areas $550,000; ACT $1,000,000; Northern Territory $600,000. The property value is assessed by the participating lender and may differ from the purchase price. Eligible property types include existing homes, house and land packages, vacant land with a separate contract to build, and off-the-plan apartments or townhouses.
The deposit required depends on the loan product and whether any government schemes apply. Under the First Home Guarantee (FHBG), eligible first home buyers can purchase with a deposit of 5% without paying LMI. Under the Family Home Guarantee (FHG), eligible single parents can purchase with a deposit as low as 2%. Outside the Home Guarantee Scheme, some ADF-specialist lenders offer home loans at up to 98% LVR inclusive of LMI for owner-occupied properties, meaning a deposit as low as 2% may be possible, though LMI would apply. Where genuine savings are required, typically for scheme-backed loans, the funds generally need to be held in the borrower's name for at least 3 months. Acceptable deposit sources include savings, equity from existing property, gifts from immediate family members, First Home Super Saver Scheme contributions, employer-paid bonuses, and government grants. The minimum deposit and genuine savings requirements vary between lenders and between schemes.
The Family Home Guarantee (FHG) is available to eligible single parents or single legal guardians with at least one dependent child. Under the FHG, Housing Australia guarantees up to 18% of the property value, allowing the borrower to purchase with a deposit as low as 2% without paying LMI. From 1 October 2025, the FHG has unlimited places and no income caps. Applicants must be single (not separated), must be the natural, adoptive, or legal guardian parent of at least one dependent child, and must not hold any other property interest once the new home settles. The applicant does not need to be a first home buyer. The same property price caps apply as for the First Home Guarantee. ADF members who meet these criteria can apply through a participating lender. A mortgage broker accredited with participating lenders can submit the application and compare product options.
Whether the Home Guarantee Scheme and the Defence Home Ownership Assistance Scheme (DHOAS) can be used on the same loan depends on the participating lender and whether they are also one of the three approved DHOAS providers. Both schemes have separate eligibility criteria and conditions. The Home Guarantee Scheme requires principal and interest repayments on an owner-occupied property through a participating lender approved by Housing Australia. DHOAS requires the borrower to hold a valid Subsidy Certificate from DVA and to take out the loan with one of the three approved DHOAS providers. Where the participating lender for the Home Guarantee Scheme is also a DHOAS-approved provider, it may be possible to combine both on the same loan. A broker familiar with both programs can assess whether this combination is available and whether it produces a more favourable outcome than using one scheme alone, depending on the borrower's LVR, deposit, and income position.
Trustee for the O'Sullivan Family Trust ABN: 29 235 649 437, Credit Representative #482294 and is authorised under Australian Credit Licence 389328.
Disclaimer: This page provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances. Names & Locations of users have been changed to protect their privacy and are illustrative only.
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