Borrowing your home deposit: the honest version.

Sometimes, and it must be disclosed to the home loan lender. The more useful question is whether you should. The personal loan repayment counts as an ongoing commitment in the home loan assessment, which reduces what you can borrow for the property — frequently by more than the deposit adds. Where it bridges a genuine short-term timing gap with a dated repayment source, it can work. Where it covers a plain shortfall in savings, it usually makes the purchase harder.

Yes, without qualification. Lenders ask directly about the source of a deposit, you sign declarations about your answers, and a recent personal loan is visible on your credit file in any case. Answering inaccurately is a false statement made to obtain credit, and can result in the loan being withdrawn before settlement as well as consequences well beyond that. We will not assist anyone to present borrowed funds as savings. Disclosed properly, it is simply a factor in the assessment.

It depends on your income, your other commitments, the loan term and the lender assessing it, so any number quoted on a web page would be invented. What we can give you is the shape of it: the reduction is driven by the repayment rather than the balance, and because personal loan terms are short, the repayment is large relative to the amount borrowed. That is why the reduction so often exceeds the deposit. We will model it against your real figures before you commit to anything.

Broadly, funds you have accumulated and held yourself over a period, rather than money that arrived in your account recently from somewhere else. Lenders look at it because a savings pattern is evidence you can set money aside consistently — the same behaviour a mortgage requires. Definitions and the weight it carries differ between lenders and products, so we will not state a rule here. Gifts, borrowed funds and windfalls are treated differently from savings, and all are asked about.

Where it is available, it is very often the stronger structure, because it adds security rather than a second repayment — so it does not eat into your borrowing capacity the way a personal loan does. The trade-off is serious and it belongs to your family: their property is at risk if the loan is not repaid, their own position has to support it, and they should take independent legal advice first. Not a free option, but for many first home buyers it is the one that actually works.

This is one of the genuine timing cases. If the gift is committed and the delay is mechanical — a property of theirs settling, an account being released, an international transfer clearing — short-term borrowing to bridge it is a reasonable conversation. Bring the amount, the source, the expected date, and written confirmation the money is a gift rather than repayable. If family do expect repayment, tell us, because that is a commitment and gets treated as one.

No. We check your position against lender policy before anything is formally lodged, so no credit enquiry is recorded while we work out where you stand. That matters here more than usual: applying for a personal loan and a home loan around the same time, and being declined for either, leaves a trail of enquiries that makes the next application harder. Working out the sequence first is most of the value.

Then you have a clear answer and it cost you nothing. In practice the conversation rarely ends there — it moves on to what would work instead: a realistic saving timeline, whether a guarantor is possible, whether a different price bracket puts you in a property this year, or whether a government first home buyer program applies to you. We would rather be the brokerage that told you the unwelcome thing early than the one that wrote a loan you regret.