- Posted by: Nerida Punter
- Category: All
Stuck on how to afford your first home? Introducing – First Home Loan Deposit Scheme
What is it?
From the 1st of January 2020, the Australian Government has created an initiative to assist people in buying their first home sooner.
How does it work?
Currently, you are required to have a 20% deposit when purchasing a property, in order to avoid paying the Lenders Mortgage Insurance (LMI) or relying on a guarantor. However, with the new scheme, the National Housing Finance & Investment Corporation (NHFIC) will underwrite the loans, so first home buyers will only need a minimum of 5% deposit and do not have to pay LMI.
Who is eligible for it?
A detailed criteria can be found on the NHFIC website, with key criteria noted below:
- Individuals must be Australian Citizens, who are at least 18years old
- Only singles or couples (either married or in de-facto relationship) are allowed to apply. Any other groups such as parent/child, siblings or friends would not be eligible
- Limited income threshold applies for singles and couples
- First home buyers will need a minimum of 5% deposit of the value of an eligible property saved prior
- Applicants must not have previously owned or had an interest in any other property in Australia and must intend to own and occupy this property within 6 months of purchasing it.
Can I use the scheme to purchase any property at any price?
No. Only ‘eligible properties’ defined by the First Home Loan Deposit Scheme and those that fit within the property price threshold are allowed. More information about the types of properties and the price caps for capital cities, regional centres and other states can be found here.
How do I apply?
- Contact our friendly team today! They will help you through the application process, including checking your eligibility and lodging the application.
- For more information visit the First Home Loan Deposit Scheme website.