How does a deposit bond work?
It’s so simple - like click, fill and approval in minutes kind of simple.
How does a deposit bond work?
A deposit bond is a powerful alternative to a cash deposit, allowing you to secure property without tying up your savings. It provides the same security to sellers and vendors as a cash deposit, while giving you greater financial flexibility.
Using a Deposit Power deposit bond is simple. Once approved, you’ll receive a fully digital bond with a QR code for instant verification. Just present the bond to the seller or real estate agent as your deposit guarantee – it’s secure, convenient, and ready to use right from your phone.
Whether you’re buying at auction, off-the-plan, or through private sale, Deposit Power can help you move forward with confidence.
What are deposit bonds? A quick overview
A deposit bond is a secure financial guarantee that assures the seller of a property the deposit will be paid at settlement.
It’s particularly helpful if you’re waiting on money from investments or sales but want to move forward with your property purchase now, or don’t quite have enough for a full cash deposit yet.
How do deposit bonds work? Step by step
It’s common… you've found the ideal property but lack the full cash deposit or don't wish to tie up your funds while selling your current property. Don't worry: with a deposit bond, you can prepare for a purchase, even without a full deposit.
It’s that simple.
1. Application process
Submit your application to Deposit Power with details about the property purchase and your financial position.
2. Quick approval
You’ll receive approval almost immediately and your digital deposit bond will be delivered to your device within minutes.
3. Purchase and settlement
Present the digital deposit bond to the seller or real estate agent instead of a cash deposit when signing the contract of sale.
Pay the full purchase price, including the deposit amount, at settlement. The deposit bond expires once settlement is completed.
Who can benefit from deposit bonds?
Buying at auction
Timing is everything. Deposit Power lets you bid with confidence – even if you don’t have immediate access to liquid cash for the deposit. With a secure digital bond in hand, you can meet the seller’s requirements on the spot, so you won’t miss out on your dream home.
A House Hunting Bond (also known as a Short-Term Bond) from Deposit Power makes securing a property fast and easy for buyers. This bond provides you with the peace of mind to continue your search, attend open homes, and go to auctions with the confidence of knowing you have the security of a deposit bond in your back pocket.
Buying off-the-plan
When you buy off-the-plan, your deposit is typically tied up for months or even years until the property is complete. Deposit bonds free up your cash, allowing you to earn interest or invest it elsewhere.
Our deposit bonds can be used for off-the-plan units or houses and land packages. For a small one-off fee, we can issue a deposit bond in a matter of minutes, giving you the freedom and flexibility to secure a property now without tying up your cash.
It’s a smart, secure way to provide the seller with peace of mind while you stay financially flexible. This is effectively our Long-term bond.
Investing & Commercial
Why tie up your capital in deposits? If you have your eye on an investment property, a deposit bond can help you save thousands. Use deposit bonds to free up funds for other investment opportunities.
Business is all about cash flow. With a Deposit Power bond you can now buy a commercial property and keep your cash liquid.
Deposit bonds are easy to obtain – you can apply online and have your application approved almost instantly. Enter the market now and pay the deposit for your investment or commercial property at settlement.
First-home-buyers
The financial pressures of securing your first property can be overwhelming. Deposit bonds reduce the need for a large upfront cash deposit – so you can secure your first home faster.
For first home buyers, a common scenario is for parents to help their children with a Guarantor Loan. In this instance, funds for the deposit are pulled from the parents’ existing offset account with roughly 6.5% p.a. (on the full debt owed). However, a smarter alternative is to use a deposit bond, where you could pay a one-off fee (percentage of the deposit bond amount only) – saving parents from extracting funds from their high interest home loan accounts.
Upsizing / Downsizing
This scenario is also known as a ‘simultaneous settlement’.
Whether you’re upsizing to accommodate a growing family or downsizing during retirement, deposit bonds help bridge cash flow gaps so you can secure your next home before your current property settles.
They’re particularly useful in situations like divorce or separation, where financial liquidity might be limited.
Vendors / Sellers
For vendors and sellers, saying ‘yes’ to deposit bonds can attract more buyers – which can lead to a higher sale price. Deposit Power bonds enable buyers who may not have immediate access to liquid funds to proceed with the purchase, potentially broadening the pool of prospective buyers.
Deposit Power is backed by HDI, a global secure and established international insurer with an AA- (Very Strong) rating. A deposit bond also guarantees the deposit payment (since it’s a legally-binding agreement), which provides added peace of mind as Deposit Power agrees to pay the deposit if the buyer defaults.
How long does it take to get a deposit bond?
Securing a deposit bond is quick and efficient.
- Get a quote (2 mins) and apply online (under 10 mins) with all required documents.
- Receive your digital deposit bond approval to your phone with a secure QR code.
- Pay the one-off fee when you need the deposit. There's no ongoing fees / interest.
- Pay the deposit directly at settlement.
Whether you’re securing a property with a short settlement or buying off-the-plan, deposit bonds are fast, reliable, and tailored to your needs.
Note: for short-term bonds, approval is instant online in most scenarios. For long-term bonds it may take a bit more time if we require any additional documents, but it can still be approved within hours (not days).
It’s truly that easy.
Why choose Deposit Power Bonds?
If you can afford the property, we’ll cover the deposit.
Move Quickly
Avoid the hassle of selling other investments or rushing to gather a deposit.
Qualify Easily
With sufficient equity or capital, secure your digital bond online in just minutes.
Grow Your Savings
Keep your cash deposit earning for you in other investments until settlement.
No Upfront Fees
Pay only when your deposit bond is approved—no money trapped upfront.
Helpful Service
Our Sydney-based customer success team is here to assist, ensuring bond approval in minutes.
Trusted Assessors
A highly experienced team in Sydney reviews and approves your application promptly.
What is a deposit bond?
Everything you need to know about deposit bonds.
What is a deposit bond?
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What is a deposit bond?
A deposit bond is a substitute for the cash deposit required when purchasing a property. The deposit bond can be for any amount up to 10% of the purchase price. At settlement, the purchaser simply pays the full purchase price of the property.
Why would I need a deposit bond?
Our deposit bonds are used in place of a standard cash deposit. Accepted, secure and so, so simple….
There are many reasons why you can benefit from using a Deposit Power bond:
- If your cash is tied up in other investments, you can use a deposit bond as a substitute to secure your property.
- When attending auctions, a deposit bond can be used to secure your purchase, you don’t need to have the cash ready at the time.
- A much better option compared to a slow, costly and cash backed bank guarantee.
- Fast – you can get your Deposit Power bond within seconds of the bond being issued.
- Save thousands! Where settlement is more than 6 months away, customers are far better off leaving their cash in either their home loan offset or in a high interest saving account.
- It’s safe! If the development is not completed your cash is not at risk.
- Secure and trusted – Deposit Power bonds are "AA-" (Very Strong) rated, secure, trusted and widely accepted.
How can I apply for a deposit bond?
Applicants can either apply directly on this website or through an accredited Deposit Power mortgage broker, conveyancer, lender or finance specialist.
How quickly can I get a deposit bond?
Simply submit your application online and you will get an immediate response. Our deposit bonds are digital and delivered to you within seconds of being issued.
What is the fee for a deposit bond?
Deposit Power charges a one-off fee to issue the deposit bond. There are no other fees or ongoing charges involved.
The fee for a short-term deposit bond (with a term of up to 6 months), is calculated as a percentage of the deposit bond amount. Fees for long-term deposit bonds are based on the deposit bond amount and term required.
You can get a fee quote by clicking on the “Get a quote” button on this website.