Are you looking to purchase your first home?
As part of the 2020-2021 Federal Budget the Australian government announced that an additional 10,000 spots were being made available for the First Home Loan Deposit Scheme (FHLDS). The New Home Guarantee (NHG) is specifically for buyers purchasing ‘new’ homes. What this means is that, first time owners can borrow up to 95% of the value of the property and the government will pay the Lenders Mortgage Insurance. All you have to do is save 5%.
Eligibility
You may only apply for this scheme as a single person or as a couple. No other arrangement such as family and friends, more than two borrowers or any instance where the second borrower is not your de-facto partner is allowed.
Further to this you will also need to satisfy the following checks:
1) an income test
Whereby the taxable income for a single applicant for the previous financial year must not be more than $125,000. And less than $200,000 for a couple.
2) a prior property ownership test
You must not have ever owned:
– a freehold interest in real property in Australia
– an interest in a lease of land in Australia with a term of 50yrs (or more) or
– a company title interest in land in Australia.
3) citizenship test
You must be an Australia Citizen. If you are applying as a couple, you will both need to be Australian citizens.
4) a minimum age test
You must be 18yrs of age or older.
5) a deposit requirement
You must show genuine savings of 5% for the deposit for the property.
6) an owner-occupier requirement.
You must move in to the property within six months from the date of settlement or, it later, the date an occupancy certificate is issued and continue to live in that property for so long as your home loan has a guarantee under the scheme.
Types of properties eligible
- newly constructed dwellings (e.g. whether a freestanding house, townhouse or apartment)
- off-the-plan dwellings (e.g. whether a freestanding house, townhouse or apartment)
- house and land packages
- land and a separate contract to build a new home.
Steps to get into your new home on the scheme
- Contact your broker to check your eligibility.
- Complete your application with your broker.
- Once your application is submitted and your broker receives your pre-approval, they will then collect documents required for eligibility and reserve your spot in the scheme.
- Purchase your new home.
Some participating lenders include, NAB, CBA, Bendigo Bank and My State Bank. If you are looking to get into your new home, reach out to your broker to find out the list of participating lenders, and find out how many spots have been allocated to each lender.
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