First Home Loan Deposit Scheme Update

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Interest rate announcement – December 2019
This month the RBA have left the cash rate on hold at 0.75% and continue to monitor the economy closely. The inflation rate is currently 1.7% which is below the RBA’s ideal range of between 2% and 3%.

The National Housing Finance and Investment Corporation (NHFIC) has appointed the National Australia Bank (NAB) as the first participant on an initial panel of lenders to offer guarantees under the Australian Government’s new First Home Loan Deposit Scheme scheduled to commence 1 January 2020, We also know that there will be one more major bank involved which means the other two will be left out. The NHFIC has committed to announcing the full panel of lenders before 20 December 2019, at the latest.

The Scheme is designed to provide a guarantee that will allow eligible first home buyers on low and middle incomes to purchase a home with a deposit of as little as 5 per cent. It will support up to 10,000 loans each financial year and is subject to eligibility criteria in relation to income thresholds and property prices.

The Mortgage Broking professional bodies have been actively involved in the consultation process, including being invited by the Minister for Housing to sit on the Treasury Reference Group for the Scheme, and have also made a submission on the First Home Loan Deposit Scheme FHLDS to both Treasury and NHFIC. Through the consultation and ongoing contact with NHFIC, the importance of broker involvement in the Scheme and the critical role brokers play in driving competition and providing assistance to FHBs has been acknowledged. 

NHFIC has, in consultation with the Mortgage Broking industry, been working to produce support resources and a dedicated information portal to assist brokers with borrower eligibility criteria and the process involved in securing the guarantee for broker customers. At present we are waiting on finalisation of the processes for the scheme from NHFIC at which point the broker resource materials will be completed so we can assist all Harvest clients.

In addition to the NAB being appointed as the first participant, the NHFIC anticipates announcing other successful panel participants shortly, subject to the finalisation of contract negotiations.

NHFIC’s Investment Mandate permits up to two major lenders to be appointed to the panel and to receive up to 50 per cent of the 10,000 guarantees allocated per financial year. A number of non-major lenders are expected to be appointed to the panel in due course.

We will maintain ongoing engagement with the NHFIC as final decisions are made in the establishment of the Scheme and we will provide further updates as the Scheme’s parameters are resolved.

NHFIC has also published a property price threshold lookup tool enabling potential borrowers, to quickly check applicable price thresholds under the Scheme for properties across the country. The tool is available at

Our Current Best Interest Rates

The best home loan rates we currently have available:

  • Variable rate of 2.80% pa (comparison rate: 3.29% pa)
  • 1 year fixed rate of 2.74% pa (comparison rate: 3.33% pa)
  • 2 year fixed rate of 2.74% pa (comparison rate: 3.31% pa)
  • 3 year fixed rate of 2.74% pa (comparison rate: 3.29% pa)
  • 5 year fixed rate of 2.74% pa (comparison rate: 3.26% pa)

Assumptions: <$400,000 loan, owner-occupied purchase, principle & interest, LVR < 80%.

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