“Detailed” consultations are due to begin with lenders considering their participation in the federal government’s First Home Loan Deposit Scheme which was announced earlier this year by Prime minister Scott Morrison.
It can take 10 years for the average first home buyer to save a 20 per cent deposit,
The scheme will help first home buyers enter the property market sooner
In a joint statement, Treasurer Josh Frydenberg and Minister for Housing and Assistant Treasurer Michael Sukkar said: “The scheme will help first home buyers enter the property market sooner, by providing a guarantee that will allow eligible first home buyers on low and middle incomes to purchase a home with a deposit of as little as 5 per cent. The scheme will support 10,000 first home buyers each financial year.
The scheme is designed to provide first home buyers (FHBs) earning up to $125,000 ($200,000 for couples) home loans of 95% LVR without having to pay LMI. The government recognises that saving a deposit has become a more significant barrier to entering the housing market than the ability to service a home loan.
As part of the proposal, the government said it would partner with private lenders and prioritise smaller lenders in a bid to “boost competition”.
“The Morrison government’s plan to build a stronger economy will continue to help first home buyers own their first home sooner,” they concluded.
Mortgage brokers who wish to offer loans under the scheme will be required to undergo appropriate training or self-education, according to the bill. At Go Mortgage we will be trained and ready when the scheme comes online so stay tuned
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