Bathurst Blog

What is the First Home Loan Deposit Scheme?

For a quick summary have a look at our First Home Deposit Scheme Infographic.

The Australian Government has introduced the First Home Loan Deposit Scheme to support first home buyers to purchase a home sooner. It does this by providing a guarantee that will allow eligible first hom ebuyers to purchase a home with a deposit of as little as 5 per cent without needing to pay for lenders morgage insurance.

The Scheme provides a guarantee that will allow eligible first home buyers on low and middle incomes to purchase a home with a deposit of as little as 5 per cent. The Scheme will support up to 10,000 loans each financial year, starting from 1 January 2020.

Applicants will be subject to eligibility criteria, including having taxable incomes up to $125,000 per annum for singles and up to $200,000 per annum for couples. The Scheme will apply to owner-occupied loans on a principal and interest basis.

Property price caps under the Scheme set appropriate price thresholds in capital cities, large regional centres with a population over 250,000 and regional areas;

Alternatives for financing your first home

The First Home Loan Deposit Scheme could make owning your first home more achievable. However, it’s worth thinking in detail about how the additional loan may impact you. Smaller deposits can often mean higher interest payments over time. If you feel you need advice, consult with a financial advisor before making any big decisions. The good news is that there are also alternatives to the Scheme, which could still pave the way for home ownership.

First Home Owners Grant

The First Home Owners Grant offsets the effect of GST on home ownership. It’s a national scheme that’s funded and administered by each state or territory. If you’re eligible, you could receive a one-off grant to assist you with the costs of buying your first home.

First Home Super Saver Scheme

The First Home Super Saver Scheme was introduced by the Coalition government in 2017-18³. It allows you to save for your first home via your superannuation fund. Because super is taxed at a concessional rate, you’ll be able to save your deposit faster.

Suncorp is proud to support first home buyers to achieve their slice of the ‘Australian Dream’. But we also understand that buying a home can be overwhelming, particularly if it’s your first. This is why we’ve created a handy guide to support you along the way. It includes useful tips and ideas for each stage of the home buying process, from when you first decide to buy to receiving your new set of keys as a first home owner.

Articles retieved from The Hon Michael Sukkar MP, Minister for Housing, Assistant Treasurer and Australian Government, National HOusing Finance and Investment Corporation

First Home Load Deposit Scheme Inforgraphic by Raine and Horne Bathurst