Property

First Home Guarantee vs LMI: Which Costs Less in 2026?

Compare the First Home Guarantee with paying LMI, including deposit size, loan size, interest and eligibility trade-offs.

RERealEstateCalc Editorial · Property & Finance Research
25 May 20261 min read
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The guarantee can remove LMI

The First Home Guarantee can help eligible buyers purchase with a smaller deposit and no LMI because the government guarantees part of the loan. That can save a large upfront premium.

But a smaller deposit still means a larger loan, which can increase repayments and interest.

Compare both paths

Run one scenario with a 5% deposit and no LMI under the guarantee. Run another with a 10% deposit and LMI. Compare repayment, interest, eligibility and property price caps.

Use the LMI Calculator and Borrowing Power Calculator before relying on either path.

Sources: Housing Australia Home Guarantee Scheme guidance and ASIC Moneysmart LMI guidance. General information only.

RE

RealEstateCalc Editorial

Property & Finance Research

The RealEstateCalc editorial team researches and writes about Australian property, finance, and tax topics. All content is fact-checked against official sources including the ATO, state revenue offices, ASIC Moneysmart, and the RBA.

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first home guaranteelmifirst home buyer5 percent depositaustralia 2026

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