Can I use the First Home Owners Deposit Scheme now?

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  [Deactivated] on 04/12/2019 - 02:26

  Risk - no banks give you finance…

  • 

    FreddyMerc on 04/12/2019 - 09:01

    -3

    Not concerned about this - two Medical Professionals with excellent credit. We have already obtained pre-approval with NAB.

    • 

      modsec802 on 04/12/2019 - 23:26

      So you earn less than 200k combined?

      • 

        FreddyMerc on 05/12/2019 - 16:23

        190k combined - this will go up 1st February so need to get on board fast if we want to use this scheme.

    • 

      Gelato on 05/12/2019 - 15:18

      Actually if you both are AHPRA approved medical professionals, doesn’t nab allow you to borrow 90% without LMI?

      • 

        FreddyMerc on 05/12/2019 - 16:21

        Not sure about NAB, BOQ do and a few others (we are both only PGY1 JMO's) looks like we need to go through a broker to secure it. Not sure if the rates would be competitive too.

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  whooah1979 on 04/12/2019 - 05:10

  Talk to a broker. They’ll do almost anything to get you the loan.

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  vikvance on 04/12/2019 - 07:02

  It's better to ask NAB about this.

  You need to get a pre-approval first before you make an offer, otherwise you run the risk of being approved for a lower amount or even rejected, and then you're really stuck.

  So, go to the bank & tell them you want to buy a home & they'll find you a lender, who will guide you. You won't be making a commitment to get the loan through NAB, so if you do decide to go with another bank or a broker, then you can still have that choice, even with a pre-approval.

  • 

    FreddyMerc on 04/12/2019 - 09:07

    Thank you, we already have pre-approval with NAB. I'm more interested to know about the integration of the FHODS and if we can use that to avoid paying LMI if we buy now. What I've learnt is that, typically, you put down your deposit (trust account), and then you must get financial approval within 5 days. I want to know if, with the extended settlement period, we are able to only apply for unconditional finance with NAB using a scheme that will only come into effect on January 1st.

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  Meho2026 on 04/12/2019 - 07:28

  +2

  No, you cant use a scheme thats not even been implemented yet.
  You'll have to pay the LMI if you havent got the 20% deposit.

  It might be worth waiting until it is implemented but you should be aware there are a few catches with the FHLDS eg
  it is only available to citizens, permanent residents are not eligible,
  there are only 10,000 guarantees per year,
  joint applicants must be married or in a defacto relationship.

  You dont need to rush into this, take your time, familiarise yourself with the process of property purchase and the terminology (stamp duty v's land tax etc)

  • 

    FreddyMerc on 04/12/2019 - 09:10

    -2

    Hello,

    Yes, well versed in the requirements, we meet all criteria.

    I know that it hasn't been implemented - however it will be implement in 3 weeks time.

    If the settlement period is 60 days can we apply in 3 weeks? I'm not sure about the buying process more so than the FHODS requirements.

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      Meho2026 on 04/12/2019 - 09:32

      +1

      You wont be able to purchase the property without the loan being approved against the property and your application info which will need to be next year to access the FHLDS.

      If you're well versed in the requirements you will be aware that you actually apply for the FHLDS (its not called FHODS) through your lender and at this stage the only approved lender is NAB.
      If you need final loan approval before Jan 1st, you wont be able to access the FHLDS.
      If you want to use FHLDS, you will probably have to apply for your loan after Jan 1st.

      • 

        FreddyMerc on 04/12/2019 - 10:47

        Yes, westpac was one but removed due to recent events. Thank you. Looks Like I'll just wait.

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  tamckinnon on 04/12/2019 - 07:37

  +1

  Not yet open until Jan 1st.

  https://www.nhfic.gov.au/what-we-do/fhlds/

  Have a read and educate yourself a bit also, you'd talk to NAB

  • 

    FreddyMerc on 04/12/2019 - 09:13

    -1

    I understand it's not open until January 1st - I think I mentioned that myself multiple times in the questions.

    I'm asking if we can purchase a house now and not settle the finance for another 3 weeks when this is available - Does this (financial approval) have to occur at the start of the offer being made, or can it happen anywhere in the 60 day settlement period.

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  Gelato on 04/12/2019 - 09:37

  Interesting question. I just had a quick look at the website.

  It says “ Please note, applications for the Scheme are not yet open.”
  Is there anywhere says all applicants will be approved for the scheme? I think there’s a risk here.

  Also there’s a processing time after the scheme is open. And you’ll have to get the finance pretty soon if you sign contract on 7th dec.

  Turnaround time at bank will get slow down in this time of the year too, expect delays for approval.

  Imo too risky and LMI may incur

  • 

    FreddyMerc on 04/12/2019 - 09:56

    It's first in, best dressed for selection. Not subjective.

    Good point on processing time.

    Worst case is that we pay LMI I guess. We are currently paying $600 A week in rent. LMI still works out cheaper than waiting for a 20% deposit and the market is on the uphill.

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      Gelato on 04/12/2019 - 22:09

      Does your pre approval include the payment on LMI?

      I guess what you said about 7k on LMI (is LMI just 7k more for a year?) versus 30k spent on rent is a valid point. However you’ve made an important assumption that the property will be worth more in a years time. This will be your call to take on the risk, people on OzB will always have different opinions.

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  JimmyF on 04/12/2019 - 09:41

  Would it be possible to purchase the unit now (December 2019) and still utilise the First Home Owners Deposit Scheme when we can apply come 1st of January?

  Not a chance

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  mskeggs on 04/12/2019 - 10:24

  +3

  I don't think there is any way to expect amateurs on a web forum to be able to answer questions about a government program that hasn't commenced yet.
  The program administrators have contact details here:
  https://www.nhfic.gov.au/what-we-do/fhlds/

  I suggest you ask them a very simple question that is unclouded by extra details:
  "Can we access the scheme for a property we wish to buy now that will settle after the 1 January project start date?"

  • 

    FreddyMerc on 04/12/2019 - 10:48

    Thank you, I'll contact them. Really appreciate your help.

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  Seasoned Salt on 04/12/2019 - 11:33

  House price is $650,000

  20% is $130,000

  Just wait and save up. If you can save up $55,000 in 1 year, just keep doing that till you are comfortably above the bare requirements.

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    FreddyMerc on 04/12/2019 - 11:50

    I question if this is worth it - I know it's what most people recommend.

    We're currently paying $600 p/w in rent - if it takes another year to save for a house that's over $30k spent in rent.

    The market is also going up so when we do buy a house in a year it will be more expensive.

    If we could get 10% deposit in the next 2 months that's only 7k in LMI - we also see this an a long term investment unit and will continue to save for our 'forever house' straight after - these saving would sit in an offset account.

    What do you think?

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  twww on 04/12/2019 - 12:05

  Sale price is 650 BUT we all know that's not what they want or what it will go for.

  Thoug,if it goes for that price, it's to someone who has their ducks in a row and is ready to go.

  There is a saying: Quote it low, watch it go…

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  StonedWizard on 04/12/2019 - 12:38

  Not to hijack OP post, but if you go off the plan and expected to settle in 6 months time.

  Can you still apply Jan 1st?