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How To Be Prepared For The First Home Loan Deposit Scheme


With the Federal Government set to release a second round of the First Home Loan Deposit Scheme, we want to ensure that you’re up to speed with the fine print.

While the release of the annual budget is always a major milestone that reaches all corners of the Australian political and economic landscape, it’s arguably never had so much riding on it. Although the government has faced slightly less pressure when compared to last year’s version, Australia’s economic rebound from the COVID-19 pandemic has given those in power slightly more money to play with than what was initially forecasted – and it heralds good news for first home buyers, thanks to the extension of the First Home Loan Deposit Scheme. 

What Is The First Home Loan Deposit Scheme?

The First Home Loan Deposit Scheme (FHLDS) was first released on January 1, 2020, and is an Australian Government initiative to support eligible first home buyers to build or purchase a first home sooner. 

While buyers are usually required to save a 20% deposit or otherwise pay Lenders Mortgage Insurance, under the FHLDS, eligible first home buyers can purchase or build a new home with a deposit of as little as 5%, with the government actually guaranteeing the remaining amount.

In essence, the FHLDS functions in a similar fashion to a traditional family guarantor loan, except it’s the government that fronts up to vouch for you, and in turn shoulder the risk. While the scheme doesn’t offer a cash payment, the good news is that you can use it in conjunction with any other government grants, schemes, concessions and waivers you qualify for, with the aim being to get Australians into their first home faster. 

In this year’s budget, the government has boosted this by adding an extra 10,000 places to the scheme from July 1, 2021 – except this time, it’s for both new and existing homes. The scheme will be available to the first 10,000 applicants, who are able to meet the following criteria:

  • Singles taxable income up to $125,000
  • Couples taxable income up to $200,000
  • Owner-occupied properties on a principal and interest basis
  • Hold Australian citizenship 
  • Purchasing your first property 
  • Purchase within the price caps outlined for each State and Territory 

Applying For The First Home Loan Deposit Scheme 

Not all Australian lending providers are participating in the First Home Loan Deposit Scheme, and the ones that are still have wildly different loan options in terms of features, fees and interest rates, so the services of a reputable mortgage broker have arguably never been more helpful to determine the best fit for you. 

One of the key pieces of documentation required in order to apply for the next rollout of the First Home Loan Deposit Scheme is your 2021 Notice of Assessment, which you will receive once you have lodged your 2020/2021 tax return.

To ensure you have a chance of securing a place on the First Home Loan Deposit Scheme, Cherry Lending & Finance highly recommends that you complete your 2020/2021 tax return as soon as you can, so that you have your Notice of Assessment ready for your application.

Getting on top of your paperwork, dealing with lending providers and trying to source the best deal can be an extremely stressful experience, particularly if you’re a first home buyer – but the good news is that it doesn’t have to be. 

With a background in banking, finance, business development and project management, there’s no better advocate to have on your team than Nikki Berzin. As a fully qualified mortgage broker and director of Cherry Lending & Finance, Nikki is passionate about all things finance, and empowering her clients with the tools to hit their property goals is what she does best. 

If you’re looking to get into your first home, purchase an investment property or even want to look at your options for refinancing, the first step is starting the conversation. Get in touch with Nikki today, or call her directly on 0427 374 155 to bring your mortgage dreams to life.

Disclaimer: Your full financial needs and requirements need to be assessed prior to any offer or acceptance of a loan product.  Subject to lenders terms and conditions, fees and charges and eligibility apply.