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FHOG (First Home Owner Grant), your Deposit, Stamp Duty costs and LMI (Lenders Mortgage Insurance)
We help assess whether you are eligible for money from the government such as the FHOG (First Home Owner Grant), or discounts in the range of exemptions, concessions and reductions!
Stamp Duty/Land Transfer Duty (Government Tax on Purchasing)
You can calculate your potential Stamp Duty (also known as Land Transfer Duty) at the link above to the Victorian government website.
When buying a home, land or investment property, you must pay Stamp Duty (a tax levied by state or territory governments). Stamp Duty is a significant amount so most lenders will only let you borrow to pay the government the Stamp Duty costs if your loan is backed by a guarantor.
Circumstances where Stamp Duty may not be applicable:
- First Home Buyers (limits apply)
- If you are buying a new home (conditions apply)
We help check your eligibility for Stamp Duty reductions as this differs across the states and territories depending on the current government incentives and programs.
FHOG (First Home Owner Grant) (Free grant money from Government)
Contact us for a free assessment of FHOG eligibility or visit the website above to select the state or territory in which you intend to purchase your home.
A one-off grant is payable to 1st home owners that satisfy all the eligibility criteria under the First Home Owner Grant (FHOG), which is a national scheme funded by the states and territories.
The FHOG money can be counted as a part of your deposit, therefore it can be included in the calculations of your LVR (Loan to Value Ratio). So, if the FHOG and your “Genuine savings” total at least 20% of your property’s value, you may avoid paying a one-off payment called LMI (Lenders Mortgage Insurance – see/click our page “Cost Of Loans’). But do note that under FHOG to build a new home on a block of land, the grant will NOT be paid until construction stage.
FHOG (First Home Owner Grant), exemptions, concessions and reductions
As a first home buyer you may be eligible for, and receive more than 1 exemption, concession or reduction from Stamp Duty for your property purchase.
In Victoria, these may include:
- First-home buyer duty exemption or concession.
- First-home buyer reduction.
- Off-the-plan concession (either as a land and building package, or as a refurbished lot).
- Pensioner concession.
- Principal place of residence (PPR) concession.
- First-home owner with family exemption or concession.
- Young farmer’s exemption or concession.
We assess whether you are eligible, then generally, the lender chosen will lodge the FHOG application on your behalf.
Deposit
Lenders need proof of “Genuine Savings” as evidence that you can maintain repaying your home loan. Most lenders want at least 5% genuine savings.
But for example, when a family member acts as a security guarantor, some lenders will allow no or very little genuine savings.
Generally, Genuine Savings are regular deposits paid into your savings bank account for at least a 3-month period. FHOG is not considered as Genuine Savings.
Examples of other possibly accepted Genuine Savings depending on the lender:
- Equity in an existing property.
- Generally held for at least 3 months- Inheritance, gift money, term deposits, bonuses, shares, dividends. Note that for gift money, lenders typically need a Statutory Declaration that the money is non-repayable and is from an immediate family member.
- Rental repayment history as genuine savings but conditions apply.
Interested? Get in touch today!
First Home Super Savers Scheme (FHSSS)
For detailed information on eligibility and limits visit ATO website for FHSS Scheme.
Under FHSS:
- Make personal voluntary, concessional superannuation contributions into your Super Fund to use towards a deposit for your first home.
- Important to apply for FHSSS determination from ATO before ownership of any property transfers to you.
Government Support Schemes- HGS (Home Guarantee Scheme)
For latest government HGS (Home Guarantee Scheme) listed below (FHBG, RFHBG, FHG) to help you buy a house, please check above website by Housing Australia.
We can help assess your eligibility and apply directly with the participating lenders for you. There are conditions for these 3 schemes, some of which are listed below.
FHBG (First Home Guarantee)
Government support to buy First Home sooner with deposit as little as 5%.
(No need to pay LMI as the government is acting as your loan guarantor till your loan is below 80% LVR).
- Only for First Home Buyers or previous homeowners who have NOT owned or had an interest in real property in Australia for the last 10 years.
- Must be for owner occupiers (not for investment)
RFHBG (Regional First Home Buyer Guarantee)
Eligible regional home buyers with a deposit as little as 5%.
Only for First Home Buyers or previous homeowners who have NOT owned or had an interest in real property in Australia for the last 10 years.
FHG (Family Home Guarantee)
Government support for SINGLE PARENTS to buy a family home with as little as 2% deposit (No need to pay LMI as the government is acting as your loan guarantor till your loan is below 80% LVR).
- Eligible Single Parents or Legal Guardians. No spouse/de-facto or must be divorced.
- At least 1 dependent child.
- Does not have to be First Home Buyer but must not currently own property.
First Home Buyer Guide (Victoria)
This “First Home Buyer Guide” Victorian government website is helpful in giving you the step-by-step information on how to buy your first home in Victoria, and where the government can help.
First Home Buyers ONLY
- Eligibility – do you qualify as a First Home Buyer for Discounts and Grant?
- Stamp Duty Discount:
- First Home Buyer Stamp Duty Exemption, Concession or Reduction.
- Grant (new homes only – payment to you)
- First Home Owner’s Grant (FHOG) and whether it can become part of your deposit
Share Equity with Government under Victorian Homebuyer Fund
The Victorian Homebuyer Fund is a shared equity scheme, where the Victorian Government provides eligible participants with a contribution of up to 25 per cent of the purchase price of the home in exchange for an equity share in the property, in which participants are required to buy back the government’s share in their property over time.
Participants need to contribute a minimum of 5% of the purchase price, cover any costs such as Stamp Duty and conveyancing, with the remaining amount to be secured through a home loan from a partner lender.
We can help with the eligibility criteria and information on buying a home with support from the Victorian Homebuyer Fund, or please visit