ASSISTANCE FOR FIRST HOME BUYERS AND SINGLE PARENTS LOOKING TO ENTER THE PROPERTY MARKET

With First Home Buyers and single parents still battling to enter the property market, some relief may be in sight come July 1st, when new places are released in two different Government schemes designed to assist certain groups looking to enter the market.

The 2 schemes are:

The First Home Guarantee Scheme (formerly known as The First Home Loan Deposit Scheme)– supports eligible First Home Buyers, with a deposit of as little as 5% required

The Family Home Guarantee Scheme – aimed at single parents, with a deposit of as little as 2% required

Effective 1 July 2022, the following places will become available in each of the schemes:

  • 35,000 First Home Guarantee scheme places will be available to eligible buyers
  • 5,000 Family Home Guarantee scheme places will be available

 

A place in the First Home Guarantee scheme means that eligible buyers only require a 5% deposit (plus any stamp duty if applicable) as opposed to a 20% deposit, and will not incur expensive Lender’s Mortgage Insurance, which can be costly and prohibitive. Price caps apply to properties purchase using this scheme (they vary from city to city), with the cap at $800k in Metropolitan Melbourne. Eligible buyers must have a taxable income not exceeding $125k for the 2021-22 financial year (or a combined $200k for a couple).

The Family Home Guarantee aims to support eligible single parents with at least one dependent child in purchasing a family home, regardless of whether that single parent is a first home buyer or a previous home owner.

Usually, home buyers with less than a 20% deposit need to pay lenders mortgage insurance.

Under this Scheme, part of an eligible home buyer’s home loan from a Participating Lender will be guaranteed by NHFIC. This is aimed at enabling you to purchase your first home sooner with as little as a 2% deposit.

You may be eligible to participate if you are single and have at least one dependent child.

Both schemes can only be accessed through certain lenders, and of course normal restrictions apply regarding borrowing capacity.

If you’d like to discuss either of these schemes further, or assess your eligibility to participate, please contact our office, one of our Lending specialists will be happy to assist you.

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