First Home Loan Deposit Scheme with a minimum deposit of 5% of the property value

The First Home Loan Deposit Scheme (FHLDS) is a government initiative designed to help first home buyers enter the property market with a minimum deposit of 5% of the property value. This scheme aims to reduce the upfront costs typically associated with purchasing a home, making it more accessible for those who may have struggled to save a larger deposit. Here's a comprehensive guide to understanding the First Home Buyer Deposit Scheme and how it can benefit you.

What Is the First Home Loan Deposit Scheme?

The First Home Loan Deposit Scheme is a program that allows eligible first home buyers to purchase a home with a deposit of as little as 5%, without the need for lenders mortgage insurance (LMI). The scheme provides a guarantee to lenders for the difference between the borrower's deposit and the standard 20% required to avoid LMI, up to a certain loan amount. Major bank lenders which opened FHLDS applications from 1 January, 2020, are:

• National Australia Bank
• Commonwealth Bank

Non-major lenders which will be opening FHLDS applications from 1 February, 2020, are:

• Australian Military Bank
• Auswide Bank
• Bank Australia
• Bank First
• Bank of us
• Bendigo Bank
• Beyond Bank Australia
• Community First Credit Union
• CUA
• Defence Bank
• Gateway Bank
• G&C Mutual Bank
• Indigenous Business Australia
• Mortgage port
• MyState Bank
• People’s Choice Credit Union
• Police Bank (including the Border Bank and Bank of Heritage Isle)
• P&N Bank
• QBANK
• Queensland Country Credit Union
• Regional Australia Bank
• Sydney Mutual Bank and Endeavour Mutual Bank (divisions of Australian Mutual Bank Ltd)
• Teachers Mutual Bank Limited (including Firefighters Mutual Bank, Health Professionals Bank, Teachers Mutual Bank and UniBank)
• The Mutual Bank
• WAW Credit Union

First home buyers will need to provide the following:

• Your full name and date of birth;
• Your Medicare number (including your position on the card);
• Your Notice of Assessment for your taxable income for the 2018-2019 financial year; and
• Other standard home loan documents.

How much can I spend on a house under the FHLDS?

New South Wales (NSW)

• City or large regional centre: $700,000
• Rest of state: $450,000

Victoria (VIC)

• Capital city or large regional centre: $600,000
• Rest of state: $400,000

Queensland (QLD)

• Capital city or large regional centre: $475,000
• Rest of state: $400,000

Western Australia (WA)

• Capital city or large regional centre: $400,000
• Rest of state: $300,000

South Australia (SA)

• Capital city or large regional centre: $400,000
• Rest of state: $250,000

Tasmania (TAS)

• Capital city or large regional centre: $400,000
• Rest of state: $300,000

Australian Capital Territory (ACT)

• $500,000
• Rest of state: Same price cap throughout the ACT

Northern Territory

• $375,000
• Rest of state: Same price cap throughout the NT

Other areas:

• Jervis Bay Territory and Norfolk Island: $450,000
• Christmas Island and Cocos (Keeling) Islands: $300,000

Price caps for the first home loan Scheme? The value of the residential property must not exceed the price cap for the area in which the property is located. The price caps will vary between states and whether you’re looking to buy in a city, large regional centre or regional areas. Loans & Mortgages are the most trusted and experienced mortgage servicing company in Australia offering services in New South Wales, Victoria, Queensland, Western Australia, South Australia, and Tasmania.