Top Tips to Get a Home Loan as a Government Employee

There is no single home loan reserved for government employees, but your job can still work in your favour.

Lenders tend to see ongoing public sector roles as stable, and some attach discounts, fee waivers or lower deposit options to that. This guide covers what those benefits look like, what they cost, and the order to tackle things in before you make an offer on a property.

Is There a Home Loan for Government Employees?

There is no official government employee home loan, but some lenders offer professional packages or policies that recognise public sector employment. Whether you qualify depends on the lender, your employer, your role and sometimes your pay band.

That means two public servants can get quite different answers from the same bank. A federal employee in a senior band, a state agency worker and a local council employee may each fall under different policies. If you work in the ACT, our page on a home loan for government employees covers how this plays out for Canberra-based staff, and our overview of home loans for public servants covers the national picture.

How Lenders View Public Sector Employment

Lenders generally treat ongoing public sector employment as stable income, which can make an application easier to assess. The detail still depends on your contract type and where you are in it.

An ongoing role is usually viewed more favourably than a fixed-term contract or a probation period, although some lenders accept qualifying fixed-term roles. If you have recently moved agencies or been promoted, your lender may want to see payslips that reflect your current salary. Allowances, overtime and bonuses are often counted at a reduced amount or only after a history of receiving them, and the treatment varies between lenders.

Rate Discounts and Features Some Lenders Offer Public Servants

Some lenders offer professional packages to government employees, and these can include a discount off the standard variable rate and waived fees. The benefits vary, so each package needs to be compared on its own terms.

A package might waive the application fee or ongoing account fees, and may include an offset account or redraw facility. The trade-off is that some packages carry an annual package fee, and a discounted rate can still sit above what a different lender charges without a package. The discount only helps if the overall rate and fees come out lower.

As a hypothetical example, take a $600,000 loan over 30 years. At the illustrative rate of 6.75% p.a., principal and interest repayments are about $3,892 a month. A package that took 0.25 percentage points off that rate would bring repayments to about $3,792 a month, roughly $100 less. If the package charged an annual fee, you would subtract that from the saving. These figures are illustrative only and are not a current rate, so use our borrowing capacity tools or a lender calculator to test your own numbers.

LMI Waivers and the 5% Deposit Scheme: Two Ways to Buy With a Smaller Deposit

Government employees can look at two different routes to avoid lenders mortgage insurance (LMI) on a smaller deposit: a lender's professional LMI waiver, or the Australian Government 5% Deposit Scheme for eligible first home buyers. They suit different people.

For LMI waivers, some lenders let selected federal government employees borrow up to 90% of a property's value without LMI. One lender's policy, for example, applies to eligible federal departments in senior employment bands, and employees of state departments and agencies are generally not covered under that offer. Policies change, so the lender's current rules matter more than any list. Our page on LMI waivers for public servants covers which lenders offer waivers and who qualifies. The main trade-off is a higher borrowed amount: a smaller deposit means larger repayments and less equity in the property.

The 5% Deposit Scheme works differently. Eligible first home buyers, or people who have not owned property in Australia for the previous 10 years, can buy with a deposit of at least 5% and without paying LMI. Housing Australia guarantees up to 15% of the property value to a participating lender. Since 1 October 2025 the scheme has had no income caps and no limit on places. The home must be owner-occupied and within the price cap for its location, and the lender checks your eligibility. Our page on the 5% deposit scheme for public servants goes through how it applies to your situation.

State and Territory Support Runs Alongside Federal Schemes

State and territory concessions are separate from the federal scheme, and each has its own rules. Qualifying for one does not mean you automatically qualify for the other.

The 5% Deposit Scheme is federal and administered by Housing Australia, while stamp duty concessions and grants come from state and territory governments. Eligibility conditions, property limits and amounts differ depending on where you buy. Check your state or territory revenue office for current details before you commit to a purchase, and ask your broker how the two programs interact for your situation.

How Much Could a Government Employee Borrow?

Your borrowing amount depends on your income, living expenses, existing debts and the lender's assessment rules, not on your employer alone. Public sector employment helps most with how stable your income looks, not with how much a lender will lend.

Lenders look at your take-home pay against your expenses and commitments. Credit card limits count even if you do not use them, and car loans, personal loans and other debts reduce the amount available. Our page on borrowing capacity explains the factors in more detail.

Consider a public servant on an ongoing salary who wants to borrow $600,000. They have a car loan and two credit cards with high limits. Their broker suggests closing one card and lowering the limit on the other before applying, because lenders assess limits as if they were fully drawn. With a lower total limit, the lender's assessment leaves more room for the home loan. At the illustrative rate of 6.75% p.a. over 30 years, the repayments on $600,000 come to about $3,892 a month, and the broker checks that figure against the lender's assessment before the buyer goes house hunting. The outcome is a clearer ceiling, and no surprise when the lender runs the numbers. The borrower should still confirm the impact of closing a card on their own credit file with their broker.

Get Pre-Approved Before You Start House Hunting

Pre-approval tells you how much a lender is likely to lend before you make an offer, so you can search within a realistic range. It is not a final approval, because the lender still assesses the property and can change its decision if your circumstances change.

Getting pre-approved first also means you know which lender policies suit you before you fall for a property. If your plan depends on an LMI waiver or the 5% Deposit Scheme, the broker can confirm eligibility early. Avoid taking on new debt or changing jobs between pre-approval and settlement, as either can affect the outcome. Our guide to getting loan pre-approval covers what to expect from the process.

Call one of our team or book an appointment at a time that works for you. We can talk through your role, your deposit and your timing before you apply.

Frequently Asked Questions