Allowing Single parents to purchase a new or established home with only a 2% deposit is one of the exciting new schemes announced in the 2021-202 budget, but how does it work?
The premise is the scheme is to assist Single parent families, predominantly women, get back into the property market sooner without the burden of a large deposit and LMI costs
How does it work?
With the Government guaranteeing the balance of normal 20% deposit funds, this allows single parent families to enter the property market with a minimum of 2% deposit funds, and avoid LMI costs entirely.
While the scheme is limited to 10,000 places, this is over four years so only represents 2,500 spots per annum, so the allocations will be hotly contested.
Single parents with dependants earning up to $125,000 per annum will be eligible for the Family Home Guarantee. They will also need to be Australian Citizens, and at least 18 years old. The scheme is also not just limited to first home buyers, but also available to applicants who have owned a home before.
When will it be available?
The Scheme will commence on the 1st of July 2021 subject to legislative approval. Further information will be available on the National Housing Finance and Investment Corporation (NHFIC) website in the next few weeks