For many Australians, buying a home has become harder than ever, and government programs are stepping in to help bridge the gap. Two of the most common pathways are the Help to Buy Scheme and the 5% Deposit Scheme, each offering support but working in very different ways. Doctors also have another layer to consider: how do their unique lending benefits compare to these schemes?
Help to Buy is a shared equity arrangement where the Australian Government becomes a co‑owner with you. Buyers need only a 2% deposit, and the loan must be taken through one of the current participating lenders. The Government then contributes up to 30% of the price of an existing property or 40% for a new build.
To qualify, you must meet specific rules: you need to be an Australian citizen, fall under the scheme’s income limits, buy within your region’s price cap, and live in the property as your main residence. It is generally limited to first‑home buyers, with some exceptions for single parents.
The 5% Deposit Scheme works very differently. Rather than sharing equity, the Government provides a guarantee to the bank, allowing you to buy with just a 5% deposit without paying Lenders Mortgage Insurance. This can save thousands upfront and significantly shorten the time needed to save a deposit.
There are no income caps and it works with a wider range of lenders. To be eligible, you must intend to live in the home and be a first‑home buyer (or not have owned a property in the past 10 years).
|
Category |
Help to Buy Scheme |
5% Deposit Scheme |
|
Minimum Deposit |
2% |
5% |
|
Government Contribution / Support |
Up to 30% for existing homes or 40% for new builds. |
Government guarantees up to 15% of the loan so you avoid LMI. |
|
Lenders |
Only CBA and Bank Australia (current participating lenders). |
Many participating lenders across major banks, second‑tier lenders and mutual banks. |
|
Ownership Structure |
You own the home but share equity with the Government. You must repay the Government’s share upon sale or buyout. |
You retain full ownership of the property. |
|
Income Limits |
Yes. Below $100,000 (single) or $160,000 (joint/single parent). |
No income limits. |
Help to Buy can be a game-changer for early‑career doctors with very limited savings. The 5% Deposit Scheme is useful for first home buyers who meet the criteria. However, many medical professionals ultimately benefit most from medical‑specific lending options.
Banks see doctors as low‑risk borrowers with strong earning potential, meaning medical professionals often have access to up to 95% LVR with no LMI, even on investment properties and refinances, giving far more flexibility than the government programs.
Want to know which option best suits your circumstances? Cutcher & Neale can guide you from the initial planning stages through to refinancing. Contact us today to secure your complimentary consultation.