First Home Guarantee Scheme (FHBG)

Buy Your First Home with as Little as a 5% Deposit

Saving a deposit is often one of the biggest obstacles for first home buyers entering the property market. With rising property prices across Melbourne, Sydney, Brisbane and many regional areas, accumulating a 20% deposit can take years.

The First Home Guarantee Scheme (FHBG) may help eligible first home buyers purchase a property with a deposit as low as 5%, without paying Lenders Mortgage Insurance (LMI).

At LaiKin Finance, we help first home buyers understand whether they qualify for the scheme, determine their borrowing capacity and navigate the home loan process from application through to settlement.

Whether you're purchasing your first apartment in Melbourne, a family home in Brisbane or an investment opportunity as a first home buyer in Sydney, we can help you understand your options and secure suitable finance.

What is the First Home Guarantee Scheme?

The First Home Guarantee Scheme is an Australian Government initiative designed to help eligible first home buyers enter the property market sooner.

Under the scheme, Housing Australia guarantees a portion of the loan, allowing participating lenders to offer loans with a smaller deposit while avoiding Lenders Mortgage Insurance.

Instead of saving a traditional 20% deposit, eligible borrowers may be able to purchase a property with as little as 5% genuine savings.

Benefits of the First Home Guarantee Scheme

Buy Sooner

You may be able to enter the property market sooner without needing to save a full 20% deposit.

Avoid Lenders Mortgage Insurance

LMI can often add thousands of dollars to the cost of purchasing a home. The scheme may allow eligible buyers to avoid this expense.

Access a Wide Range of Properties

The scheme can be used for eligible owner occupied properties, including existing homes, newly built homes and certain off the plan purchases.

Suitable for Singles and Couples

Both individual applicants and couples may be eligible, subject to meeting the scheme requirements.

Who May Be Eligible?

Eligibility requirements can change over time, however common considerations include:

• Australian citizenship or permanent residency requirements

• Income thresholds

• First home buyer status

• Owner occupied intentions

• Meeting lender credit criteria

• Purchasing within applicable property price caps

Our team can help determine whether the scheme is available based on your circumstances and chosen location.

Example Scenario

A first home buyer couple from Brisbane had saved approximately 6% of the purchase price and were concerned they would need several more years to reach a 20% deposit.

After reviewing their circumstances, we identified that they may be eligible under the First Home Guarantee Scheme. By combining the scheme with an appropriate lender, they were able to purchase their first home significantly sooner than expected and avoid paying Lenders Mortgage Insurance.

How LaiKin Finance Helps

Many first home buyers are unsure where to start.

Questions we commonly hear include:

• How much can I borrow?

• How much deposit do I need?

• Which government incentives apply to me?

• Which lender is most suitable?

• What documents do I need?

We simplify the process by guiding you through every step and comparing loan options across our lender panel.

Useful Calculators

Before purchasing your first home, we recommend using the following tools:

Borrowing Capacity Calculator

Estimate how much you may be able to borrow based on your income and commitments.

Home Loan Repayment Calculator

Understand how different loan amounts and interest rates may impact your repayments.

Stamp Duty Calculator

Calculate government charges and upfront costs associated with your purchase.

Current Market Rates

Compare indicative market rates and see where your current or proposed rate sits within the market.

Frequently Asked Questions

  • Eligible borrowers may be able to purchase a property with as little as a 5% deposit, subject to lender requirements and scheme availability.

  • One of the key benefits of the scheme is that eligible borrowers may avoid paying Lenders Mortgage Insurance despite having less than a 20% deposit.

  • Potentially.

    Self employed applicants may still be eligible provided they satisfy both the scheme requirements and lender credit assessment criteria.

  • Yes.

    Eligible couples can apply jointly under the scheme.

  • In many cases, yes.

    Apartments, units, townhouses and houses may all be eligible provided they meet scheme requirements.

  • No.

    The scheme is intended for owner occupied purchases and borrowers are generally expected to live in the property.

  • Lenders generally assess employment income, self employed income and other acceptable income sources in accordance with their lending policies.

  • Yes.

    Property price caps apply and vary depending on the location of the property.

  • Potentially.

    Depending on your circumstances, the scheme may be used alongside other eligible government grants and concessions.

  • The easiest way is to speak with an experienced mortgage broker who can assess both your eligibility for the scheme and your borrowing capacity.