3 Steps to Apply for the First Home Loan Deposit Scheme

Aug 5, 2021 | Loan Application, Property Investing

If you’ve heard of the popular first home loan deposit scheme and want to secure your spot but don’t know where to start, we’ve got your back!

Under this scheme, qualified first home buyers can enter the property market sooner with a deposit of as little as 5% without paying the lenders mortgage insurance (LMI). And now, with its extension, you can buy properties with higher property price caps!

Here’s how you can apply for the first home loan deposit scheme.

1) Check if you’re eligible

To make your application a success, make sure you’ve ticked the eligibility criteria. Check them below.

Eligibility criteria

  • You should either be an individual or couple (married or de facto) when applying for this scheme
  • You are an Australian citizen(s), at least 18 years of age
  • If you’re an individual, you must be earning up to $125,000 taxable income, or if you’re a couple, you must be earning $200,000 taxable income
  • You intend to be owner-occupier(s) of the purchased property
  • You must be a first home buyer(s) who have not previously owned or had an interest in a property in Australia

2) Apply through an FHLDS participating lender

Speak and apply through an FHLDS participating lender or your mortgage broker. Once you get your pre-approval, you get to secure your spot for the FHLDS.

3) Find your home and move in

When you have a pre-approval, you will have 90 days to purchase your dream home then, you’re ready to settle and move in.

How does the First Home Loan Deposit Scheme work?

First home buyers with less than a 20% deposit usually need to pay for lenders mortgage insurance.

However, under this scheme, the Government will guarantee a part of the eligible home buyer’s home loan, helping them purchase their first home with a deposit of as little as 5% without paying LMI.

Here are the three schemes you might be eligible for and which can help you buy an investment property:

First Home Loan Deposit Scheme helps you purchase your first home with a deposit of as little as 5% without paying LMI.

New Home Guarantee helps you build or buy your first home, with higher property price caps available in selected areas.

Family Home Guarantee helps eligible single parents with at least one dependent child buy a family home with as little as a 2% deposit.

Each of these schemes has 10 000 spots available from July 1, 2021, to June 30, 2022.

Let us get your loan application rolling

With these schemes, you are a few steps closer to buying your first home.

While 10 000 spots for the FHLDS and another 10 000 spots for the New Home Guarantee seem a lot, it has been filled up pretty fast during the previous years.

So, if you are ready to apply for the FHLDS or got some questions, please get in touch, and we can help make the loan application process seamless for you.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

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