family home guarantee

Last Updated on January 16, 2023 by

Potential first-time buyers of homes may be eligible for assistance from the FHLDS (family home guarantee). In this article, we will explore the program and explain how first-time buyers may acquire a new house with a deposit of just 5%, provided that they can service their home loan installments and any extra home loan expenses.

Update on the family home guarantee for 2022

Please note that the family home guarantee will be terminated as planned on June 30, 2022, as was declared in the federal budget for the fiscal year 2022-23.

If, on the other hand, you are a first-time buyer constructing or purchasing a new house, you may still be qualified to obtain assistance in order to acquire a new home with a smaller initial down payment. This is made possible by the 35,000 places that are up for grabs as part of the First Home Guarantee program offered by the government.

What exactly is the new home guarantee?

The government has added 10,000 more spots to the First Home Loan Deposit Scheme (FHLDS), which is part of the new home guarantee program. This was first proposed in the federal budget for the fiscal year 2021-2021. The First Home Loan Deposit Scheme (New Homes), sometimes abbreviated as FHLDS (New Homes), provides an extra 10,000 applications for home loans.

Eligible to apply

The qualifying conditions for the FHLDS (New Homes) are comparable to those of the FHLDS that were already in place and were first announced in 2019. You will need to satisfy all of the following requirements in order to qualify for the FHLDS new home guarantee:


A single candidate must have an annual taxable income of less than $125,000, while a couple’s combined income must not exceed $200,000 in order to be eligible for the new home guarantee program. For example, for any applications filed to the FHLDS (New Home Guarantee) up to June 30 in, 2022, the applicable fiscal year that will be evaluated is FY2020-21. In order to submit an application for this program, you will be required to supply the applicable Notice of Assessment issued by the ATO for the financial year that ended before.

Joint applications

Joint applications for the FHLDS (New Homes) will only be considered for approval if the applicants are married or live together as a de facto pair. Other kinds of joint applications, such as those submitted by siblings, parents and children, friends, and so on, are not acceptable.


To qualify for the First family home guarantee Loan and Development Scheme (FHLDS), also known as the New Home Guarantee Scheme, you must be a true first-time home buyer. This means you have never owned or had an interest in any property in Australia. This includes any assets held under shared ownership, commercial properties, investment properties, and corporate titles.


The FHLDS (New Home Guarantee Scheme) requires all applicants to be Australian citizens who are at least 18 years old in order for them to be considered for eligibility.


The FHLDS, sometimes known as the New Home Guarantee, is a program tailored exclusively for first-time homebuyers who want to reside in the property they purchase. Investment homes are not permitted under this program, and you must reside in the house for at least six months after purchasing it before receiving a guarantee on your mortgage through the program.


First-time purchasers with at least a five percent deposit are eligible for the FHLDS (New Home Guarantee), which is solely offered to them. It is intended to make it easier for first-time buyers to join the market by minimizing the amount of time that is often needed to build up the full 20% deposit that is necessary. If you have a deposit of at least 20% of the purchase price saved up, you are exempt from this program since you won’t need to have your house loan covered.

How exactly can one make use of the New Home Guarantee?

This program allows individuals planning to buy their first home or construct a new one to apply for a house loan with a 5% deposit and not have to pay for mortgage insurance from the lender (LMI).

The National Housing Finance and Investment Corporation manages the Federal Home Loan Deposit System for New Homes (NHFIC). The New Home Finance Insurance Corporation (NHFIC) will issue a guarantee to the participating lender of up to 15 percent of the value of the property being financed if you are successfully authorized for a spot in the new home guarantee program. As a first-time buyer, this allows you to qualify for a mortgage with as little as a 5% down payment and avoid having to pay private mortgage insurance (LMI).

Having a house of one’s own and buying a property with a mortgage both carry additional responsibilities in addition to the down payment; therefore, it is essential to be aware of this fact. The homebuying process sometimes involves unexpected charges, which purchasers of homes need to remember to account for while developing their spending plan. Additional expenses may be associated with things like construction and pest control, as well as legal fees.

This is when the counsel of specialists comes in handy. Your neighborhood Mortgage Choice broker looks out for your most pressing needs. They will be able to offer you an estimate of the expenses associated with purchasing your property, which will assist you in avoiding being taken aback by any unexpected charges that may arise in the future. By reading more here, you may learn more about the hidden expenses of purchasing a property.

Which Types of Houses and Apartments are Eligible for the Program?

Because this program is only open to first-time purchasers interested in constructing or purchasing newly constructed homes, the criteria for an eligible house have been narrowed down. However, to be eligible for the FHLDS (New Home Guarantee), you will need to form a contract of sales and/or construction contract prior to the expiration of your 90-day pre-approval. This requirement applies to all property types that are eligible for the FHLDS.

Apart from this, if you are interested to know about Space for Your Favorite Hobby then visit our Home Improvement category.