First Home Loan Deposit Scheme - New Places Available
Make 2022 The Year You Start Your Journey As A First Home Buyer
Transcript of - FHLDS New Places Available
The Federal Government have just released another 4500 spots on the First Home Loan Deposit Scheme, which is great for first home buyers. Today, we’re going to have a chat about why that is.
What is the First Home Loan Deposit Scheme?
First off, what is the FHLDS. It stands for First Home Loan Deposit Scheme. And it’s a government initiative to help first time buyers get into the market before I get into the nitty gritty. Basically, if you’ve got 5% deposit, you might be able to access this game and get into the market. So if that’s you, what I would do is contact a mortgage broker like us here at Will Bell Mortgage Broker, and make a plan to get into your first to understand the First Home Loan Deposit Scheme, you kind of need to understand how a loan works.
How does the First Home Loan Deposit Scheme work?
Back to the First Home Loan Deposit Scheme and how a loan works. So basically, when you go to a lender and you ask for a loan, usually a first home buyer, they’ve got a small deposit, a lender views a small deposit as under 20% of the purchase price. What that means is the low that deposit you have means the increased risk the lender has that you will default and not be able to pay the loan and therefore the bank may make a loss, the bank mitigate this risk by taking out an insurance policy. And what that insurance policy does is protect the lender in case they lose any money from lending you the money. This is called Lenders Mortgage Insurance and they make you the customer pay for that policy, the cost of that is generally three or 4% of the purchase price. So on a $600,000 property, for example, you’d be paying 18 to 24 grand, not just paying it means you’d have to save up that extra 18 to 24 grand. This is where the First Home Loan Deposit Scheme comes in. Essentially what it is, is the government coming in and saying hey, this borrower is good for the loan, if you make a loss bank will cover what that means is you don’t have to save up that extra 18-24 grand, which means you can get into your first home a lot faster. So that’s it.
Is the First Home Loan Deposit Scheme for you?
I hope that’s given you a broad idea of how the First Home Loan Deposit Scheme works. If you think you’re in a position where you could potentially go for this now or in the next few months, then please get in contact with us and we can help you make that a possibility. Once again, if you’re enjoying our content, do not hesitate to like, subscribe, and follow our social channels! Cheers!