First Home Guarantee Scheme Fact Sheet

Overview:

The First Home Guarantee (FHG) scheme is an initiative by the Australian Government aimed at helping first home buyers enter the property market sooner. It allows eligible buyers to purchase a home with a deposit as low as 5%, without needing to pay for lenders mortgage insurance (LMI).

Key Features

• Deposit Requirement: Eligible first home buyers can secure a loan with a deposit as low as 5%.
• Lenders Mortgage Insurance: The scheme allows participants to avoid the cost of LMI, which is usually required when borrowing more than 80% of the property value.
• Guarantee Cap: The government guarantees a portion of the loan, which can make it easier for buyers to secure financing.

Eligibility Criteria

• First Home Buyer: Applicants must be first home buyers and must not have previously owned a home.
• Age Requirement: All applicants must be at least 18 years old.
• Income Limits: Applicants must meet specific income thresholds:

- Singles: Up to $125,000
- Couples: Combined income up to $200,000
- Property Value Limits: The property must fall within certain price caps, which vary by location.

How to Apply

• Find a Participating Lender: Not all lenders participate in the scheme, so it's important to check which lenders offer it.
• Check Eligibility: Ensure you meet the eligibility criteria outlined above.
• Apply for a Home Loan: Submit your loan application to a participating lender.
• Complete the Application for the First Home Guarantee: Your lender will help you with the application process for the guarantee.

NSW Specific Information

Property Price Caps in NSW:

• Capital City: Up to $900,000 (Sydney)
• Regional Areas: Varies based on location, with a general cap of $600,000 to $700,000 in various regions.
• Support for Regional Buyers: The scheme aims to support buyers in regional areas by providing access to affordable housing options.

Additional Support

• First Home Owner Grant: First home buyers in NSW may also be eligible for the First Home Owner Grant, which provides a one-off payment to assist with the purchase of a new home.
• Stamp Duty Exemptions or Concessions: Depending on your circumstances, you may qualify for exemptions or concessions on stamp duty.

Important Notes

• The First Home Guarantee Scheme is limited in the number of guarantees available each financial year.
• The scheme applies only to residential properties (new or existing homes).
• Always seek financial advice before proceeding with a property purchase.