The ACT Party says the Greens are overplaying what students would save if they used its proposed scheme to help them get into their first homes.

Green MP Gareth Hughes has drafted a Members Bill that would allow student loan holders to divert all or part of their loan repayments into a first home savings account.

Mr Hughes said people are stressed out, they're looking at rising house prices, wondering if they'll ever be able to scrape together enough for a deposit.

He said this would allow people to prioritise; pay off their loan, or save for a home.

LISTEN: Green MP Gareth Hughes speaks with Larry Williams

However, ACT leader David Seymour said the Green Party's online calculator is wrong because it assumes student loan holders pay 12 percent of their total income, rather than 12 percent of all income above the repayment threshold of just over $19,000.

He said the policy promises people earning $45,000 a year would save an extra $5,400, nearly twice as much money as they'd actually save ($3109.92).

"The Greens have assumed that you pay on all your income, thus exaggerating the amount of money you'd save," he said.

Seymour said the policy would lead to graduates ending up with a mortgage, a student loan and a higher tax bill all at once.

He said you cannot get to prosperity by shifting around your debts.

"But in spite of that, they also haven't managed to do the most basic mathematics to explain how much students would get, and they've actually misled students."

The Bill is yet to go into a Parliamentary ballot and there's no guarantee it will go before the House.