As a result of the successful first round of the Federal Government’s First Home Loan Deposit Scheme, 10,000 loan guarantees are now available for first home buyers over the next 12 months.
What is the First Home Loan Deposit Scheme?
To refresh your memory, the Scheme is an initiative by the Australian Government in conjunction with the National Housing and Finance Investment Corporation (NHFIC) introduced to help people venture into home ownership sooner with as little as a 5% deposit and not having to pay Lender’s Mortgage Insurance (LMI).
A big perk of the scheme is that it can be used in conjunction with the First Home Super Saver Scheme and the First Home Owners Grant (FHOG).
Am I eligible?
This Scheme is subject to certain limitations, it’s a good idea to speak to your broker now to help you plan and prepare so you have your finances in order and are ready to make your home owner dream a reality.
- The lender will lend eligible applicants up to 95% of the value of the property without charging lenders mortgage insurance;
- The Scheme is only available to first home buyers, who are buying property for owner occupied purposes;
- If the applicants are joint applicants or tenants in common, both applicants must be first home buyers;
- The Scheme is available for the purchase of established property or for the purchase of land and construction of a property;
- The Scheme will be subject to a price cap on the property, which will vary depending on the area the property is located to ensure the Scheme assists applicants nationwide. The property caps will be set out in the Investment Mandate, to be released later this year;
- Eligible applicants must be Australia citizens over the age of 18 years old and will be subject to an income cap of $125,000 for single applicants or a combined income of $200,000 for joint applicants; and
- Applicants are required to make regular principal and interest repayments (interest only will not be allowed).
Learn more about the FHLDS and its key facts including what type of property can be bought and the property price thresholds!