When buying your first home, we understand that it can be a big step and a daunting experience. We take our time to address the concerns and queries of clients looking to buy their first home and seek to find the best loan product that would fit in with the client’s circumstances and goals.
We assess what you own (assets) and what you owe (liabilities), to understand your long-term commitments that could potentially affect your ability to repay a loan. We then look at your regular sources of income and expenses and assess that in line with bank and government rules and regulations. There is a legislative buffer that we take into consideration when working out your monthly surplus, to allow for interest rate rises, which has been common over the latter half of 2022.
When purchasing your first home, the government also recognizes that it is a big step and accordingly, subject to an eligibility criterion, you can qualify for grants to buy your first home.
The First Home Buyer Scheme is an Australian Government scheme designed to help first home buyers purchase property. It provides tax breaks and other assistance to help first home buyers get onto the property ladder.
You normally need 5% genuine savings over three months to prove to lenders that you can save and contribute towards a proposed home loan as well as being able to meet ongoing repayments from settlement date.
There are also legals and costs associated with the purchase including Lenders Mortgage Insurance (LMI) which vary depending on lender. If you cannot pay the LMI cost upfront, you can ask your lender if they allow the LMI to be added to the loan or not. There are lenders who will use your rental history for the past 12 months to verify your capacity to service the loan. So if you have a good rental history (no rent arrears), you can use this instead as your proof of genuine savings.
To avoid paying the LMI premium, you need to first improve your interest rate. If you have family or parents kind enough to allow you to use the equity in their home or investment property, all the better — this family guarantee type of set-up can work very well.
There are plenty of scenarios that work. But they need to be tailored for each client as everyone’s situation is different. This is where mortgage brokers Brisbane comes in.
The scheme offers two types of assistance: a First Home Owner Grant (FHOG), and stamp duty concessions.
The First Home Owners’ Grant (FHOG) is a one-time payment to help first home buyers with the costs of buying or building their first home.
Who is eligible for first home owners grant? To be eligible for the Australian First Home Buyers Grant, you must:
- be an Australian citizen or permanent resident
- be 18 years of age or older
- have never owned or had an interest in a property before; and
- be buying or building a new home as your principal place of residence.
The first home buyer stamp duty concession is a tax break offered to first-time home buyers in Australia. The concession reduces the amount of stamp duty that first-time buyers have to pay on the purchase of their home.
To be eligible for the concession, you must be buying your first home in Australia and it must be worth less than $600,000. The concession applies to both new and existing homes. If you’re buying an existing home, the value of the stamp duty exemption will be capped at $300,000
The concession is available in all states and territories in Australia.
The Family Home Guarantee is a scheme provided by the Australian Federal Government via the government’s National Housing Finance and Investment Corporation (NHFIC). Basically, the aim of this scheme is to make it easier for single parents to purchase the property they need to support their families through a guarantee that tops up the deposit paid by the buyer.
When single parents access the Family Home Guarantee, they can acquire a home loan with a far smaller deposit, sometimes as low as 2% of the total property value. The government’s scheme will guarantee the remaining 18%, bringing the total amount up to the required 20%. This protects the home loan provider while also ensuring that single-parent families can purchase a home.
To be eligible, the applicant must
- be legally single (no spouse or a de facto partner, not separated from their partner but have not finalized their divorce)
- have one or more dependent children
The First Home Guarantee is a new government scheme that will help first home buyers get their deposit up to $30,000. It’s available to anyone who has never owned a home before, and you can use it towards the purchase of any type of property (new or existing).
The scheme works by providing an interest-free loan to the purchaser, which is then paid back over time through the mortgage. The loan can be used for deposits of up to 20% of the purchase price, and there’s no limit on how much you can borrow. You don’t need to be a first-time buyer to access the scheme – if you’ve never owned a home before, your partner can also use it.