Homebuyers up in the air despite new government home loan support
Homebuyers up in the air despite new government home loan support
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
The government's promise of an equity contribution will help the most disadvantaged Australians to get a home loan, but they still won't be able to afford one.
Labor's "Help to buy" home loan scheme
Labor's centrepiece cost-of-living policy announced during the election was its Help to Buy scheme, which aimed to slash the cost of buying a new dwelling by 40 per cent and an existing one by 30 per cent.
Up to 10,000 applicants could get smaller deposits, smaller mortgages and smaller repayments.
Low-income borrowers may still find it hard to qualify for a mortgage when relying on a 2 per cent deposit, especially given that other schemes have not been successful.
Home loan qualification
The federal government concedes that saving a 2 per cent deposit won't be nearly enough for most low- to middle-income borrowers to qualify for finance to buy a home.
This is particularly so given that the mortgage might still be over $600,000 even after the government’s contribution , depending on where the home is located.”
That said, the barrier to entry for battlers may not be permanent.
NHFIC’s existing first-home loan scheme, requiring applicants to put down 5 per cent has a 90 percent success rate.
It’s not much for the desperate battler looking to buy a home, but it might provide some hope for someone in need of a loan to purchase an $800,000 home with only $16,000 instead of $40,000 deposit.
First-home buyers who don’t have government help and a 20 per cent deposit will need to pay lenders mortgage insurance.
Home loan experts
It would be essential for first home buyers to consult experts where and what to buy, especially given they will eventually need to pay back the government's equity stake, including capital growth.
It is even more important when, fundamentally, they will have to give up a significant percentage of the home equity and any value gain if they choose to sell down the track. In fact, this may prevent them from upgrading at all.
A survey of 1000 Australians found 41 per cent want the new federal government to address housing affordability, as many as those wanting an improved healthcare system, and even more than those seeking action on climate change.
Published:Sunday, 29th May 2022 Source:
Please Note: If this information affects you, seek advice from a licensed professional.
Commonwealth Bank of Australia (CommBank) has strengthened its commitment to environmental sustainability by expanding its Green Home Offer through a renewed partnership with the Clean Energy Finance Corporation (CEFC). This collaboration introduces enhanced financial incentives for homeowners aiming to improve their property's energy efficiency. - read more
The Australian Securities and Investments Commission (ASIC) has intensified its efforts to regulate financial content on social media by issuing warning notices to 18 'finfluencers'-individuals who use social media platforms to discuss financial products and investments. These actions are part of a coordinated international initiative targeting unlicensed promotion of high-risk financial products. - read more
Virgin Australia has unveiled its 'Pets in Cabin' service, a pioneering initiative that allows passengers to travel with their pets in the aircraft cabin on select domestic routes. This service caters to Australia's substantial pet-owning population, offering a more comfortable and convenient travel option for both pets and their owners. - read more
If you are seeking lower rates, lower fees and more flexibility in your home loan. you are in luck! Our national panel of mortgage brokers is looking forward to an opportunity to assist you. Apply online for a free eligibility assessment and one of our broker network refinance specialists will get on the case to track down the best deal for your individual circumstances. Without any obligation and at no charge to you!
The landscape of personal finance is continuously evolving, and in Australia, this includes the manner in which debt is managed. In recent times, an increasing number of Australians have found themselves navigating the complex maze of personal debt, from credit cards to student loans, and grappling with the impact this has on their financial well-being. - read more
Applying for a loan online has become a standard practice in today's digital world. It offers the convenience of applying from the comfort of your home, swift processing, and quick disbursements. However, the online loan application process is fraught with potential pitfalls that could hinder your chances of approval or lead to less favorable terms. - read more
Understanding the concept of creditworthiness is essential, especially when considering the various financial decisions you make in life. In Australia, a good credit score can open doors to competitive loan rates, favorable mortgage terms, and hassle-free approvals for financing. Conversely, bad credit can be a significant roadblock, impacting your financial well-being and limiting your access to financial resources when you need them most. - read more
