First Home Loan Deposit Scheme

Update: February 2020

The initial 3,000 places of the First Home Loan Deposit Scheme, designated to Commonwealth Bank and NAB, were taken within eight days of the scheme launch. A further places 7,000 designated to smaller lenders were released on 1 February and are going quickly with high demand.

Although this is the case, those who have secured a position only have 14 days (including weekends) to receive conditional approval from one of the scheme’s lenders in order to secure their funds. As a result, lenders who have fulfilled their quotas have begun to generate waitlists to fill positions of those that do not qualify.

Contact our home loan experts to ask about waitlist positions, or to get your documentation completed and ready for immediate application when a further 10,000 places will be released from July 1 2020.

As of 1 January 2020, we saw the introduction of the First Home Loan Deposit Scheme. Typically, borrowers are required to provide a 20% deposit or alternatively pay costly Lenders Mortgage Insurance (LMI). Under the new scheme, the government will guarantee first home loans allowing first home buyers to borrow up to 95% of their home, as a result allowing them to provide a much smaller deposit without the need to pay LMI. 

The government has been quick to outline the First Home Loan Deposit scheme’s criteria:

State / Territory Capital city and
regional centres
Rest of the state
NSW $700,000 $450,000
VIC $600,000 $375,000
QLD $475,000 $400,000
WA $400,000 $300,000
SA $400,000 $250,000
TAS $400,000 $300,000
ACT $500,000
NT $375,000

Commentators have been quick to call out the limitations of the scheme and doubt over its projected effectiveness, however the federal Opposition did promise to match the scheme when unveiled by the current government in the last election. In October 2019 it passed through parliament with the Oppositions support and will be reviewed in 12 months. 

If you are in the process of planning and saving for your first home, it may be the perfect time to chat to one of our home loan specialists about getting your application ready. Fill out a 2 minute application here or call 1800 898 765.