Saving a deposit for your first home can be challenging.
We’re really excited to participate in the FHLDS to help more first home buyers realise their home ownership dream sooner.
What is the First Home Loan Deposit Scheme?
The First Home Loan Deposit Scheme is a new initiative from the Australian Government designed to support eligible first home buyers purchase a home sooner.
The National Housing Finance and Investment Corporation (NHFIC) will provide a guarantee for eligible first home buyers on low and middle incomes so that they can purchase a home with a deposit of as little as 5%.
The Scheme will support up to 10,000 home loans each financial year, starting from 1 January 2020, through a panel of participating lenders
Why this is great news for you?
If you want to buy a property today you typically need to save at least 20% of the property’s value in order to secure a home loan and avoid paying Lenders Mortgage Insurance or to avoid relying on a guarantor.
Under the First Home Loan Deposit Scheme, you’ll be required to contribute a minimum of 5% of the property’s value towards the deposit. The NHFIC will then provide a guarantee covering up to 15% of the property’s value.
Are you eligible for the First Home Loan Deposit Scheme?
You can check your potential eligibility on the NHFIC website. As well as income thresholds and property prices, the following conditions will generally also apply:
- Australian citizens who are at least 18 years of age. Permanent residents are not eligible
- Applicants must not have previously owned or had an interest in a residential property, either separately or jointly with someone else (this includes residential strata and company title properties, regardless of whether it was an investment or owner-occupied property and whether it was ever lived in)
- Only singles with a taxable income of up to $125,000 per annum and couples with a combined taxable income of up to $200,000 per annum may be eligible
- Couples are only eligible for the scheme if they are married or in a de facto relationship. Other persons buying together, including siblings, parent/child or friends, are not eligible
- The Scheme will only apply to Owner Occupied home loans paid on a principal and interest basis (property investment and Interest Only loans are excluded). If the loan relates both to the purchase of vacant land to the construction of a house on the land, the loan may still be an eligible loan even if the terms of the loan agreement permit Interest Only payments for a specified period
- Applicants must have a deposit of between 5% and 20% of the property’s value
- Your maximum property purchase price is subject to the suburb and postcode of your new property. You can check the property price threshold for your property’s suburb and postcode using NHFIC’s property price threshold tool
You can only receive the Government Guarantee once.
How do you apply?
Applications for the First Home Loan Deposit Scheme are now open.