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Government Schemes to Help First Home Buyers

houseEva Chang Mar 4, 2021

Buying your first home is an exciting but often daunting experience. Fortunately, there are several government schemes in place to help first home buyers achieve their dream of homeownership. In this article, we'll explore two key schemes: the Victorian First Home Buyer Grant and the First Home Buyer Guarantee, and how Melcity Finance Broker can assist you in making the most of these opportunities.

Victorian First Home Buyer Grant

The Victorian First Home Buyer Grant is a one-off payment for eligible first home buyers purchasing or building a new home in Victoria. A $10,000 First Home Owner Grant (FHOG) is available when you buy or build your first new home.

Eligibility Criteria for First Home Owner Grant (FHOG)

  1. Occupancy: At least one applicant must occupy the home as their principal place of residence (PPR) for at least 12 months, commencing within 12 months of settlement or completion of construction.

  2. Contract Price: The contract price for the home must be $750,000 or less. For off-the-plan purchases, it is the contract price that must meet this criterion, not the dutiable value. Additionally, the home must not have been previously sold or occupied as a place of residence, including for short-term accommodation like Airbnb.

  3. Age: Applicants must be aged 18 or over (discretionary).

  4. Citizenship or Residency: Applicants must be an Australian citizen or permanent resident.

  5. Previous Grant: Applicants must not have received a First Home Owner Grant in Australia.

For more information and to check your eligibility, visit the State Revenue Office Victoria.

First Home Buyer Guarantee (FHBG)

The First Home Guarantee (FHBG) is part of the Home Guarantee Scheme (HGS), an Australian Government initiative to support eligible home buyers to buy a home sooner. It is administered by Housing Australia on behalf of the Australian Government.

Under the FHBG, part of an eligible home buyer’s home loan from a Participating Lender is guaranteed by Housing Australia. This enables an eligible home buyer to buy a home with as little as 5% deposit without paying Lenders Mortgage Insurance(LMI).

For the FHBG, any Guarantee of a home loan is for up to a maximum amount of 15% of the value of the property (as assessed by the Participating Lender). This Guarantee is not a cash payment or a deposit for a home loan. Eligibility criteria apply.

Eligibility: To apply for the FHBG, home buyers must be:

  1. applying as an individual or two joint applicants
  2. an Australian citizen(s) or permanent resident(s)* at the time they enter the loan
  3. at least 18 years of age
  4. earning up to $125,000 for individuals or $200,000 for joint applicants, as shown on the Notice of Assessment (issued by the Australian Taxation Office)
  5. intending to be owner-occupiers of the purchased property
  6. First home buyers or previous homeowners who haven't owned or had an interest in a real property in Australia (this includes owning land only) in the past ten years.

For more information and to check your eligibility, visit the Australian Government's Housing Australia website.

Navigating government schemes for first home buyers can be complex, but with the help of Melcity Finance Broker, you can make the process smoother and more rewarding. Contact us today to learn more about how we can assist you in buying your first home.