The First Home Loan Deposit Scheme is a new initiative of the Australian Government to support eligible first home buyers purchase a home sooner.

It does this by providing 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 federal government’s First Home Loan Deposit Scheme will guarantee mortgages for First Home Buyers who have only saved a 5% deposit, effectively helping them buy sooner without having to pay lenders mortgage insurance.

• If you have saved 5% of the purchase price of your property the government will guarantee the remaining 15% of the deposit.

• You still need to borrow 95%, but you can avoid Lenders Mortgage Insurance (LMI)

• Eligible first home buyers can’t be earning more than $125,000 a year ($200,000 combined for couples).

• Your mortgage needs to be an owner-occupied loan with principal and interest repayments.

• Access to the scheme is limited to the first 10,000 borrowers nationally (that’s only 9% of the current FHB market).

• The scheme is anticipated to start on 1st January 2020. NO formal details yet..

Application process

Please note applications for the Scheme are not yet open. Further information regarding the application process will be provided shortly.

NHFIC is currently conducting a procurement process to establish a panel of residential mortgage lenders to participate in the Scheme.

Borrower applications and questions will need to be directed to approved panel lenders.

Only certain lenders will have access to and be able to approve the scheme, we are yet to have all details on which lenders at this stage

Eligibility criteria

Applicants under the Scheme will be subject to eligibility criteria, including criteria in relation to income thresholds and property prices.

The income thresholds will be up to $125,000 per annum for singles and up to $200,000 per annum combined for couples (assessed in the financial year preceding the financial year in which the loan is entered into).

The Scheme will apply to owner-occupied loans on a principal and interest basis.

Further detail about the core design elements of the Scheme, including borrower, lender and loan eligibility criteria can be found in the Investment Mandate for the Scheme. This is the mechanism through which the Government details its expectations of the National Housing Finance and Investment Corporation (NHFIC) and the NHFIC Board.

You can download a fact sheet about the Scheme here:

First Home Loan Deposit Scheme – Fact Sheet

An online, interactive eligibility checklist will be available on this website shortly.

Property price thresholds

To ensure the Scheme is only available for the purchase of a modest home, or the purchase of land and construction of a modest home, the following property price thresholds (maximum property purchase price under the Scheme) will apply in capital cities, large regional centres and regional areas:

The capital city price caps will apply to large regional centres with a population over 250,000 (the Gold Coast, Newcastle and Lake Macquarie, the Sunshine Coast, Illawarra (Wollongong) and Geelong), recognising that dwellings in large regional centres tend to be significantly more expensive than other regional areas.