Home Guarantee Guide for First Home Buyers
First
The First Home Guarantee (previously known as the First Home Loan Deposit Scheme) is an Australian Government initiative managed by the National Housing Finance and Investment Corporation (NHFIC). This program is designed to support eligible low- and middle-income Australians in purchasing their first home by reducing the deposit requirement, avoiding Lenders Mortgage Insurance (LMI), and providing access to lower interest rates.
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Typically, borrowers need a 20% deposit to avoid LMI costs. However, under this scheme, eligible buyers can secure a home loan with a 5% deposit without paying LMI, as the government guarantees up to 15% of the property’s value.
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Combining the First Home Guarantee with Other Government Support
First home buyers who qualify for the scheme may also be eligible for other government programs, such as the First Home Owners Grant and stamp duty concessions offered by various states and territories.
Participating lenders and mortgage brokers will evaluate a buyer's eligibility for the First Home Guarantee alongside other standard loan criteria, including serviceability, borrowing capacity, and credit assessments.
Note: Applications for the First Home Guarantee can only be submitted through participating lenders, not directly by applicants.
Eligibility Requirements for First Home Buyers​
To qualify for the First Home Guarantee, applicants must meet several criteria:
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Citizenship and Age: Applicants must be Australian citizens or permanent residents, at least 18 years of age, and applying individually or as joint applicants.
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Income Limits:
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Single applicants: Taxable income cannot exceed $125,000 for the prior financial year.
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Joint applicants: Combined taxable income must not exceed $200,000 for the prior financial year.
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Deposit Requirement: Applicants must have a deposit of at least 5% but not more than 20% of the property’s value. Deposits over 20% make the home loan ineligible for the scheme. Most lenders also require that at least 5% of the deposit comes from genuine savings.
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Owner-Occupier Requirement: Applicants must intend to live in the property as the primary residence. Active Australian Defence Force members may have the owner-occupier requirement waived due to service obligations.
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Proof of Income: Applicants need to provide their latest Notice of Assessment (NOA) from the ATO.
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First Home Buyer Status: Applicants must not have previously owned or held an interest in residential property, whether individually or jointly. This includes all residential property types, whether occupied or held as investments.
Loan Conditions Under the First Home Guarantee
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Loans under the First Home Guarantee must have scheduled repayments of principal and interest for the entire loan term, not exceeding 30 years.
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While applying for the guarantee has no associated costs, applicants are responsible for all costs and repayments related to their home loan.
Reminder: Applications for the First Home Guarantee must be submitted through the lender providing the loan.
Property Eligibility
Property price thresholds apply, and these vary based on whether the property is in a capital city, large regional center, or regional area. To view the maximum allowable purchase price for properties in your area, refer to NHFIC’s property price threshold cap table.
Under the First Home Guarantee, buyers may purchase:
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Existing houses, townhouses, or apartments
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House and land packages
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Land with a separate building contract
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Off-the-plan apartments or townhouses
Different property types may be subject to specific conditions, including deadlines for contract execution.
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Additional NHFIC Resources for the First Home Guarantee
For tools and resources, visit the Housing Australia website.
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Disclaimer
This website has been prepared with all due diligence and care, based on the best available information at the time of last update. Fortifi Finance holds no responsibility for any errors or omissions within. Any decisions made by other parties based on this information are solely the responsibility of those parties. Capstone Mortgage Solutions Pty Ltd ACN: 665 796 234 is an authorised credit representative 547296 of Australian Finance Group Ltd ACN 066 385 822 (AFG) Australian Credit Licence 389087.




