Lenders open applications for deposit scheme extension

By Gerv Tacadena

What do would-be applicants need to know about the additional guarantees for the scheme?

Lenders have opened the applications for the extension of the First Home Loan Deposit Scheme.

The federal government announced 10,000 additional slots for the scheme during the Budget 2020 in an effort to rebuild the economy from the impacts of the COVID-19 pandemic.

Under the scheme, home buyers will be able to apply for a loan with as little as 5% deposit. The government will be guaranteeing as much as 15% of the total value of the property, allowing the home buyer to apply for the loan without having to pay for the lender's mortgage insurance.

The additional guarantees will be available until 30 June 2021. However, it is crucial to note that the additional slots will only be for the purchase of a new home. Property price caps are also increased in all states and regions. The table below shows the new price caps for the additional slots:

Property price caps are also increased in all states and regions for the deposit scheme.

Kristin Brookfield, chief executive for industry policy at the Housing Industry Association, said the scheme has proven to be a success since its inception with the first two allocations being well subscribed.

"The emphasis on new builds and an increase on the price caps for new homes means that it has never been a better time for Australians to think about building or buying a newly built home," said Kristin Brookfield, chief executive for industry policy at the Housing Industry Association.

The following lenders started accepting applications for the extension of the deposit scheme:

  • Australian Military Bank
  • Defence Bank
  • P&N Bank
  • Australian Mutual Bank
  • G&C Mutual
  • People’s Choice
  • Bank Australia
  • Gateway Bank
  • QBank
  • Bank of Us
  • IBA Group
  • Qld Country Bank
  • Bendigo Bank
  • The Mutual
  • Regional Australia Bank
  • Commonwealth Bank
  • MyState
  • WAW Credit Union
  • Community First
  • National Australia Bank
  • Auswide Bank
  • Credit Union Australia
  • Police Bank
  • Bank First
  • Mortgageport
  • Teachers Mutual Bank
  • Beyond Bank

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