First Home Buyers: How to Maximise the Benefits of the Home Guarantee Scheme

Becoming a homeowner is a significant milestone, but now more than ever the path to buying your first home can feel intimidating.

There are options, however, to help get you there. There are numerous options offered by both state and federal governments, but it can be confusing to understand which ones are relevant to you. An important scheme to consider is the Home Guarantee Scheme (HGS).

We’ll explain a little about what this is, and how to maximise the benefits of the HGS so you can own your own home sooner.

So what is the Home Guarantee Scheme?

The Australian Government's Home Guarantee Scheme (HGS) is designed to assist eligible first-home buyers on their journey. Through the First Home Guarantee (FHBG) and the Regional First Home Buyer Guarantee (RFHBG), you can purchase a home with as little as a 5% deposit and avoid the cost of Lender's Mortgage Insurance.

The HGS consists of four components

The First Home Guarantee (FHBG) - designed to help eligible first home buyers enter the property market with a deposit as low as 5%.
The Regional First Home Buyer Guarantee (RFHBG) - created to support eligible first homebuyers residing in regional areas to purchase a home.
The Family Home Guarantee (FHG) - introduced to aid single parents with at least one dependent child in purchasing a home with a deposit as low as 2%.
New Home Guarantee (NHG) - An expansion of the FHLDS, the NHG is designed specifically for first home buyers building new homes or purchasing newly built ones.

Here are some key strategies to maximise the benefits of the Home Guarantee Scheme:

Understand Your Eligibility

Each component of the HGS caters to different demographics and has unique eligibility requirements. For instance, to benefit from the FHBG, you must be an Australian citizen, a first home buyer, and intend to be an owner-occupier of the purchased property. The RFHBG requires home buyers to have lived in the regional area they are purchasing in for the preceding 12 months.

Plan your finances

The minimum deposit required for both the FHBG and RFHBG is 5% of the value of the qualifying property. However, the specific deposit amount can vary depending on the lender and your individual financial situation. It's essential to plan your finances appropriately to prepare for this commitment and any unexpected costs that may arise.

Choose the right property type

The HGS covers a range of property types, from existing houses and apartments to house and land packages and off-the-plan properties. Each option has its own advantages and considerations. Choosing a property type that best suits your financial capacity and lifestyle preferences can maximise the benefits you receive from the scheme.

Consider Regional Options

If you've lived in a regional area or have considered moving to one, the RFHBG offers an excellent opportunity. Understanding the regional property market can help you leverage this opportunity effectively. Not to mention everyone loves a tree or sea change. We might be biased, but we absolutely adore both the Mid North Coast and Parkes areas.

Partner with the Right Lender

The HGS is offered through a panel of participating lenders, each with its own criteria and loan offerings. Navigating this landscape and choosing a lender that not only fulfils the requirements of the HGS but also aligns with your personal financial circumstances and homeownership goals can be instrumental in maximising your benefits.

Why are more and more people choosing to partner with a mortgage broker to buy their first home?

While these strategies can guide you in leveraging the Home Guarantee Scheme, navigating the complexities of this journey can still pose challenges. This is where a mortgage broker can become an important resource. With their extensive knowledge and experience in the housing and financial markets, a mortgage broker can guide you through the eligibility requirements, application process, and the strategic planning needed to maximise the HGS benefits.

A mortgage broker can negotiate with lenders on your behalf to secure better loan terms. They can help you understand the costs associated with the loan, such as interest rates, fees, and charges, ensuring complete transparency.

Our goal is to help regional Australians by simplifying the home-buying process and helping you maximise the advantages of the Home Guarantee Scheme.

We offer tailored advice to suit your individual circumstances, ensuring a confident and informed journey towards homeownership.

We’ve put together a First Home Buyers Guide that you can download for free below to learn more about what’s available to you when it comes to buying your first home. Or if you’re ready to take the next step, get in touch with one of our local brokers below.

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Are you a first homebuyer?

There are a number of grants and programs offered by the government to help get you there.

To help you understand and navigate what's available to you, we've put together a comprehensive FREE First Home Buyers Guide.

Get your copy below.

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