More first home buyers to benefit from 5% deposits

The federal government has announced the extension of the First Home Loan Deposit Scheme, opening up 10,000 new places to aid in post-COVID-19 economic recovery.

A statement from Treasurer Josh Frydenberg outlined that the additional places would be available from today, 6 October 2020, to support the purchase of a new home or a newly built home.

The First Home Loan Deposit Scheme (FHLDS) allows eligible applicants to purchase a home (within certain price restrictions based on location) with a deposit of just 5 per cent, without paying lender’s mortgage insurance.

Originally, 10,000 places were made available in the FHLDS for the 2020-21 financial year, with all 5,000 non-major lender quota places filled within the first three months of the financial year.

The opening up of new places in the scheme does have a tighter set of requirements than the initial scheme, restricted to the building of a new home or purchase of a newly built home, which was not a requirement of the original scheme.

Mr Frydenberg said the additional guarantees will be available until 30 June 2021 “and will drive more construction and support jobs as part of our Economic Recovery Plan”.

The FHLDS can be used in conjunction with the First Home Super Saver Scheme and HomeBuilder grants, as well as relevant state and territory grants and concessions.

If you have any questions or concerns about your existing loans, need further guidance on hardship assistance, or have other questions about your loan arrangements, you can arrange a convenient time to speak to Jesse Bruno, our mortgage broker at CentraMoney by clicking here

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