If you missed out the first time, the second round of the First Home Loan Deposit Scheme will kick off on 1 July with a further 10,000 spots up for grabs, but you'd better make sure you get your application in quickly.

Despite the economic uncertainty of the impact of COVID-19 on the property market, applications for the second round of the scheme are expected to be keenly sought.

The First Home Loan Deposit Scheme (FHLDS) is a government initiative designed to help eligible first home buyers secure their first home with a deposit as low as 5% by guaranteeing up to 15% of the value of the home, thus avoiding costly Lenders Mortgage Insurance (LMI).

Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

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LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees Max LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkComparePromoted ProductDisclosure
6.04% p.a.
6.06% p.a.
$3,011
Principal & Interest
Variable
$0
$530
90%
4.6 Star Customer Ratings
  • Available for purchase or refinance, min 10% deposit needed to qualify.
  • No application, ongoing monthly or annual fees.
  • Quick and easy online application process.
Disclosure
5.99% p.a.
5.90% p.a.
$2,995
Principal & Interest
Variable
$0
$0
80%
Apply in minutes
  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
 Disclosure
6.09% p.a.
6.11% p.a.
$3,027
Principal & Interest
Variable
$0
$250
60%
  • No annual fees – None!
  • Get fast pre-approval
  • Unlimited additional repayments free of charge
 Disclosure
5.69% p.a.
6.16% p.a.
$2,899
Principal & Interest
Fixed
$0
$530
90%
  • Available for purchase or refinance, min 10% deposit needed to qualify.
  • No application, ongoing monthly or annual fees.
  • Flexibility to split your loan with both fixed and variable rates
 Disclosure
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of . View disclaimer.

Important Information and Comparison Rate Warning

The scheme's first 10,000 places, released on 1 January 2020, showed strong demand for the program particularly among first home buyers under the age of 30.

One of those buyers was 26-year-old Blaise Menzies-White who bought his first property in Victoria after securing a spot in the scheme through Bendigo Bank.

“That’s what made it possible for me to buy my first home - it was the difference between buying right now and waiting another couple of years to save the $20,000-$30,000 extra I would have needed to make the minimum deposit," he said.

Mr Menzies-White said the COVID-19 pandemic only strengthened his decision to purchase a bigger home. 

“COVID-19 has been really stressful for so many people. I think people are going to want more space in everything, when they eat out, go out and perhaps also in how they live. Shoebox style apartments in cities may not be as popular that they once were for the fear of germs and catching disease.

“I’m very lucky that I have a property with a lot of space, that I was able to purchase before COVID-19, that I am still employed, and that my friends live with me to help pay the mortgage.”

According to the latest figures from the National Housing Finance and Investment Corporation (NHFIC) (the entity administering the scheme) 5,500 guarantees have been issued, with another 4,500 having reserved a guarantee and in the process of finding their first home.

With the second round of the scheme kicking off on 1 July, here are a few things buyers need to know before applying for the scheme. 

Read: The complete guide to the First Home Loan Deposit Scheme

Can you apply for the scheme if you haven't lodged your tax return?

If you want to apply for the scheme, you'll need to provide a Notice of Assessment from the Australian Taxation Office for the 2019-20 financial year.

This means you'll need to lodge your tax return ASAP if you want to apply for the scheme when it kicks off on 1 July.

Can you use the scheme in conjunction with the HomeBuilder grant?

Yes. The $25k HomeBuilder scheme can be used in conjunction with existing state and territory First Home Owner Grant programs, stamp duty concessions and other grant schemes, as well as the Commonwealth’s First Home Loan Deposit Scheme and First Home Super Saver Scheme.

Essentially this means you could use the FHLDS to buy your first home, then take advantage of the $25k HomeBuilder grant to renovate it into your dream property.



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