Understanding the Family Home Guarantee Scheme in Australia
7th November, 2024
The Family Home Guarantee (FHG) is a valuable initiative designed to help eligible single parents and legal guardians buy a home sooner. This Australian Government program aims to support those who may struggle to enter the housing market due to financial barriers.
Who is Eligible?
To qualify for the FHG, you must be:
- A single parent or legal guardian with at least one dependent.
- An Australian citizen or permanent resident.
- At least 18 years old.
- Earning no more than $125,000 per year.
- A first home buyer or a previous homeowner without current property ownership.
If you meet these criteria, you can take advantage of the program.
How Does It Work?
From 1 July 2024 to 30 June 2025, there are 5,000 places available under the FHG. The scheme allows you to purchase a home with a deposit as low as 2% of the property’s value. This is a significant reduction compared to the standard requirements.
When you apply, a portion of your home loan, up to 18% of the property’s value, is guaranteed by Housing Australia. This guarantee means you won’t need to pay for Lenders Mortgage Insurance, which can save you a substantial amount.
Types of Properties
Eligible properties include:
- Existing houses, townhouses, or apartments.
- House and land packages.
- Off-the-plan apartments or townhouses.
It’s essential to check the property price caps for your area, as these limits vary across states and territories.
How to Apply
To get started, you must apply through a Participating Lender. They will require a Notice of Assessment (NOA) to verify your income. The NOA is a document issued by the Australian Taxation Office (ATO) after your tax return is processed. It details your taxable income for the year, which helps lenders assess your eligibility for the FHG. Ensure you have at least 2% saved for your deposit.
*Remember, while the FHG helps make homeownership more accessible, applicants must still meet all loan repayment obligations.
If you need guidance navigating the complexities of home buying or the Family Home Guarantee, reach out to Bangalow Conveyancing, your trusted conveyancing partner. We’re here to help you every step of the way, ensuring a smooth transition into your new home.
Did this blog help you? Check out our other informative blog posts today!
