Surf Coast First Home Buyers unlikely to qualify for New Deposit Scheme

At the 11th hour of the 2019 election, the Liberal Government announced a First Home Loan Deposit Scheme that would see the Government become the Guarantor for 10,000 First Home Buyer Loans, instead of an expensive Lenders Mortgage Insurer, or family member. Since then, buyers have been waiting for the details of who would be eligible, given there were around 110,000 First Home Buyers the previous year.


Here’s the detail:

  1. The scheme is still targeting a 1 January start date, but delays are expected

  2. There’s an income cap of $125,000 (or $200,000 combined income for a couple who are both first home buyers) based on the 2018-19 tax year.

  3. The scheme targets and supports those First Home Buyers who have saved at least 5% as a deposit themselves

  4. Buyers will need to apply to the National Housing Finance & Investment Corporation (NHFIC), and if successful, they will be granted “time-limited access to the guarantee”

  5. Only certain lenders will be eligible to provide the guarantee. NAB is the only bank to have been announced as a provider of the loans. A maximum of 2 of the Big 4 lenders will offer the loans, and Westpac has been ruled out as a contender due to their widely reported compliance failures. A maximum of 2,500 loans will be offered by the Big 4, encouraging competition and access to smaller lenders.

  6. The Australian Prudential Regulatory Association (APRA) will have final say on which lenders meet their qualifying standards, and it is expected that only those lenders who are administratively able to offer family guarantees may be able to facilitate the process

  7. Buyers will have to meet all other normal lending criteria set by the bank (including the need to be able to “service” a loan that is up to 95% of the property value).

Here's the issue for Surf Coast buyers. The scheme targets entry level properties only, and as such, regional caps have now been set, as per below:

Torquay and surrounds do qualify for the higher $600,000 cap but there are very few Surf Coast homes under that price. However some suburbs outside of the coastal areas do still qualify for this higher cap. Would be buyers can search their target postcode on the NHFIC Website here to see whether the $600,000 or $375,000 cap applies.


In many cases it is likely that the existing Regional First Home Owners Grant of $20,000 is the best contribution applicable to most buyers on the Surf Coast, along with the Stamp Duty Concessions. However there’s a cloud hanging over how long this will be available. The First Home Owners Grant is due to expire on 1 July 2020, unless it is extended. So given building contracts can take at least 2-3 months to finalise, would-be recipients need to be locking this in sooner rather than later to be sure time doesn’t run out.

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For more tips & advice, contact Lanie Conquest or Nicola Tucker at Surf Coast Finance

With over 25 years’ banking & financial services experience, we help local families & businesses make smart financing decisions.

M: 0418 938 646 ( Lanie Conquest)

E: [email protected]

M: 0491 020 810 ( Nicola Tucker)

E: [email protected]

W: surfcoastfinance.com.au

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