Are you looking to purchase your first home? It may be easier than you think. From as little as a five percent deposit, you could potentially secure a new home in regional Victoria.
The Australian Government recently opened 10,000 new places in its Regional First Home Buyer Guarantee (RFHBG). Designed to support regional customers purchasing their first home, the guarantee allows eligible buyers to take out a loan without paying Lenders Mortgage Insurance (LMI). This guarantee is not a cash payment or a deposit for a home loan and is assessed by participating lenders.
Below, we step you through the details of the RFHBG and how you could potentially take advantage of this to build ‘The One.’
Who can apply for the RFHBG?
To be eligible, you must be a first home buyer intending to live in the home you purchase. You can apply as an individual or as a couple, but you both must be 18 years old or over and Australian citizens.
Eligible individuals can earn up to $125,000, and couples can earn up to $200,000, and you must have your Australian Taxation Office 2021-2022 Notice of Assessment completed to confirm your earnings.
Read more: Four reasons to make the move to regional Victoria.
At least one of the homebuyers must have lived in the regional area (or adjacent regional area) they intend to purchase a home in for the preceding 12-month period to the date you execute the home loan agreement.
Still not sure if you’re eligible? You can use the Government’s Eligibility Tool to find out if you meet the selection criteria. You can also enter your postcode into the Regional Checker to ensure your town is classified as regional.
Will I still need a home deposit if I’m eligible for the RFHBG?
Yes. You will still need to have saved between five per cent and 20 per cent of the home you wish to build in order to apply for a loan.
When can I apply for the RFHBG?
You can apply for a place in the RFHBG from 1 October 2022 until 30 June 2023.
While June 2023 may seem like a long way, there are only 10,000 places available in a highly competitive property market.
The RFHBG also comes with strict contract execution deadlines, so it’s definitely worth getting the ball rolling as soon as possible.
What type of home can I build under the RFHBG?
House and land packages can be purchased through RFHBG.
You just need to be sure that the builder you select can meet the contact execution dates and criteria set out by the National Housing Finance and Investment Commission (NHFIC) – the body responsible for administrating the RFHBG on behalf of the Australian Government.
Can I borrow money for a house from any Australian bank?
No. Only a select panel of lenders have been approved by the NHFIC. You can find the full list of participating lenders on the NHFIC website. Your mortgage broker will investigate a panel of suitable lenders on your behalf.
How do I apply?
You’ll need to apply via one of the participating lenders or through a mortgage broker.
Still need help deciding if you are eligible?
Our in-house specialists, Resolve Finance, can help you determine if you are eligible for any available government grants or schemes including the RFHBG. Their team will find the right home loan that best suits your individual needs and will walk you through the entire application process. Reach out to Resolve Finance today.
Lenders terms and conditions apply and may vary. Eligibility is at the discretion of the Federal Government. Further information on the Regional First Home Guarantee can be found here. All Financial services provided by Resolve Financial Solutions Pty Ltd trading as Resolve Finance ABN: 65 079 545 378 Australian Credit Licence No. 385487. Please refer to the relevant State & Federal Government media statements here.
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