Not all home loans are able to take the benefit of the Scheme. The Scheme is restricted to ‘Eligible Loans’, which are home loans:
- made by a Participating Lender to
(1) a single eligible first home buyer, or
(2) a couple who are both eligible home buyers, and
- that are for the purchase of an Eligible Property that is to be occupied by you as the owner, for as long as it is backed by the Scheme
In addition to these overarching eligibility requirements, the loans must:
- be secured by a registered first ranking mortgage over the eligible property
- have no other registered owners at the time of settlement other than the eligible borrower/s
- have 100% of the loan drawdown proceeds used for the purchase (or towards the purchase and improvement) or construction of the eligible property
- have a loan amount commitment not less than 80% and not more than 95% of the relevant Value of the property
- have a loan term of 30 years or less
- require regular repayments of principal (with limited exceptions for interest-only loans, which mainly relate to construction lending). Exception to this will be granted during the construction of a new dwelling, whereby lenders will be able to allow borrowers to make interest only repayments for the period in which the dwelling is being constructed until it can be occupied by the borrower.