Australia to expand Home Guarantee Scheme criteria

An Australian government program called the Home Guarantee Scheme (HGS) helps qualified homebuyers acquire a home faster. The National Housing Finance and Investment Corporation (NHFIC) oversees the Scheme on behalf of the Australian Government.

The First Home Guarantee (FHBG) helps qualified first-time buyers purchase their first home faster and with as low as a 5% down payment. There are 35,000 openings each fiscal year.

• The Regional First Home Buyer Guarantee (RFHBG) assists qualified first-time homebuyers in purchasing a residence in a regional area. Ten thousand spots will be offered each fiscal year from October 1 2022, until June 30 2025.

• The Family Home Guarantee (FHG) helps qualified single parents with at least one dependent child purchase a home with just a 2% down payment. There are 5,000 spots available each fiscal year through June 30, 2025.

There is no longer a New Home Guarantee (NHG) program. An NHG position reserved on or before June 30, 2022, may still move forward to settlement, provided that it satisfies the NHG’s qualifying standards.

The Home Guarantee Scheme’s qualifying requirements will be increased; the Australian Government has announced, starting on July 1, 2023. The Government’s amendments have yet to take effect and will call for changes to the NHFIC Act and the organization’s investment mandate.

NHFIC will guarantee a portion of a home loan from a Participating Lender to an eligible home buyer under the HGS. Due to this, a qualified home buyer can buy a house with a deposit of up to 5% (depending on the Guarantee they receive) without having to pay lender mortgage insurance. The Guarantee is not a down payment on a mortgage or a cash payment.

NHFIC has approved a panel of 32 Participating Lenders to provide homebuyers with the HGS.

The HGS Comparison Table below outlines the salient characteristics of the three Guarantees. This data is offered to homebuyers as a guide, and it does not guarantee that a buyer will obtain a Guarantee or loan from a Participating Lender.

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