Looking to buy your first home with a 5% deposit?

The federal government’s First Home Loan Deposit Scheme which was again commenced last July 1, 2020 has opened itself for limited slots only. Save yourself up you $10,000 by voiding the Lender’s Mortgage Insurance (LMI).The scheme allows eligible first home buyers to purchase a property with only a deposit of 5%, and waive the payment of the LMI – saving you up to $10,000. For this financial year only 10,000 slots are available.

What is the First Home Loan Deposit Scheme?

When taking out a home loan, payment of the LMI is common among first home buyers who wants to have a deposit of less than 20%. But for eligible first home buyers availing of the federal government’s First Home Loan Deposit Scheme, purchase a property with a deposit of only 5% without the payment of the LMI is made possible.

You make think 10,000 slots are a lot, with the starters gun already going off, there are already hundreds of first home buyers that could apply for the scheme every day in just the first two weeks alone.

The Australian Government took the initiative of providing the First Home Loan Deposit Scheme as a way of supporting First Home Buyers to purchase their first home. Under normal circumstances a First Home Buyer who wants to purchase a property with less than 20% deposit would have to pay the Lenders Mortgage Insurance, which would cost you up to $10,000. The First Home Loan Deposit Scheme allows eligible First Home Buyers to purchase their home following certain condition, with a deposit as little as 5%.

The bank will be guaranteed by the Australian Government with up to 15% of the needed deposit to finance the First Home Buyer’s home loan.