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Dreaming of owning your first home but worried about the deposit? The First Home Guarantee Scheme (previously known as the FHLDS), along with its Family and Regional variations, lets you buy a home with as little as 2% to 5% deposit—without paying Lenders Mortgage Insurance (LMI). In this updated guide, we explain each scheme, who’s eligible in 2025, and exactly how to secure your spot before the places run out.
What Is The Home Guarantee Scheme?
The First Home Guarantee (previously known as the First Home Loan Deposit Scheme or the New Home Guarantee) is a no LMI scheme which allows home buyers to enter the market with as little as a 5% deposit.
There are three main benefits to the scheme:
- You can enter the market more quickly with a lower deposit.
- You can save almost $30,000 on Lenders Mortgage Insurance (LMI).
- You gain access to lower interest rates usually reserved for buyers with a bigger deposit, allowing you to save thousands on your repayments.
There are a couple of limitations, though:
- The scheme is only eligible for properties worth up to $700,000 in Brisbane.
- In other areas of Queensland, the price cap is $550,000. (For other states, see below.)
- You must be living in the property.
- It’s not available for investment properties.
- The scheme is limited to 35,000 spots per financial year, so you may miss out if you don’t apply quickly enough.
First Home Guarantee Scheme Expanded OLD Eligibility In 2025
The First Home Guarantee Scheme (sometimes referred to as the First Home Buyers Scheme) has criteria you must meet before being approved. Here is the expanded list of the eligibility criteria for 2025:
Requirement | Eligibility |
Taxable Income | Single applicants: up to $125,000 taxable income per year Couples: up to $200,000 combined taxable income |
Deposit | At least 5% deposit, up to a maximum of 20% deposit |
First Home Buyer | You must not have owned property in Australia before. But if you have owned a property before, you can still qualify, as long as it’s been at least 10 years since you owned the property. |
Property Type | An existing house, townhouse or apartment OR a house and land package OR Land and separate contract to build a home OR an off-the-plan apartment or townhouse. |
Citizenship | Australian citizens and Australian permanent residents are eligible. |
Property Price Cap | Up to $700,000 in Brisbane, Gold Coast, and Sunshine Coast. Up to $550,000 for the rest of Queensland. (We cover other states below) |
Minimum Age | Aged 18 years and older |
Living Arrangement | You must move in and live in the property as your home within 6 months. If you move out of the home you are no longer covered by the scheme. |
Relationship | You can apply as a single person, married couple or in a de facto relationship. You can also team up with your friends, siblings or other family members to apply for the First Home Guarantee Scheme and the Regional First Home Buyer Guarantee |
Buying type | You must be buying as an individual not as a company or (family) trust. The First Home Guarantee Scheme is only for residential properties and not commercial. |
Banks | Only 27 lenders can offer the scheme. The lenders that are participating include CBA, NAB and some non-major lenders include Bendigo Bank, Bank Australia & Teachers Mutual Bank. |
Single Parents | Single legal guardians of kids, including aunts, uncles, and grandparents, are now eligible for the Family Home Guarantee. Previously the scheme was only for single parents not guardians. |
If you are unsure whether or not you qualify, get in touch with our team, and we can guide you through your eligibility – for free.
How Does The Scheme Work?
The government acts as your guarantor, allowing you to buy a home without paying thousands of dollars in lenders’ mortgage insurance.
Ordinarily, you’d need at least a 20% deposit to avoid paying lenders mortgage insurance, which is a one-off insurance added to the loan. With the First Home Guarantee Scheme, you avoid the LMI fees as the government provides a guarantee of up to 15% of the value of your home.
However, your home loan and Home Guarantee Scheme Application will still be subject to regular home loan considerations, such as borrowing capacity, credit checks, and suitable employment.
A limited number of spots are released in the scheme each financial year and are allocated on a first-come, first-served basis.
Hunter Galloway is an accredited Mortgage Broker in Brisbane and Australia-wide. Through our pre-approval loan process, we can help you reserve your place in the Home Guarantee Scheme.
If you are considering your eligibility for the scheme or would like to reserve a place, call us on 1300 088 056 or contact us.
How Much Will I Save?
The First Home Guarantee Scheme can save you thousands of dollars. For example, based on our LMI calculator, if you were buying a house for $700,000 with a 5% deposit, you would pay $29,991 in LMI.
House Price | LMI saved under the First Home Guarantee Scheme. |
$500,000 | $16,720 |
$550,000 | $23,564 |
$600,000 | $25,707 |
$650,000 | $27,849 |
$700,000 | $29,991 |
In addition to these savings, you can also take advantage of schemes such as Stamp Duty concessions, the First Home Owners Grant or the First Home Super Saver Scheme.
Read more: Government grants to buy a first home.
What Are The Property Price Limits For The First Home Guarantee Scheme?
The First Home Guarantee Scheme [FHGS] has been designed to help lower to middle-income earners struggling to buy their first home. So, if you want to buy a million-dollar luxury home, this scheme is not for you. Below are the property price caps for the First Home Guarantee Scheme around Australia.
The Home Guarantee price limits vary depending on the state or territory and whether you’re looking to buy in a city, large regional centre or other regional area.
Area | Capital City And Regional Areas | Rest Of State |
New South Wales | $900,000 | $750,000 |
Victoria | $800,000 | $650,000 |
Queensland | $700,000 | $550,000 |
Western Australia | $600,000 | $450,000 |
South Australia | $600,000 | $450,000 |
Tasmania | $600,000 | $450,000 |
Australian Capital Territory | N/A (all areas treated as capital/regional) | $750,000 |
Northern Territory Regional | N/A (all areas treated as capital/regional) | $600,000 |
Jervis Bay Territory and Norfolk Island | N/A (all areas treated as capital/regional) | $550,000 |
Christmas Island and Cocos (Keeling) Islands | N/A (all areas treated as capital/regional) | $400,000 |
Source: Housing Australia
What determines the higher price caps?
Throughout the country, some regional centres are allocated higher price caps. This means that the buyers can purchase at a higher price and still be eligible for the deposit scheme. The population of the region determines this.
The government outlines that regional centres with over 250,000 people, like the Gold Coast, Geelong and Newcastle, will have a higher price cap.
Step-by-Step Guide For The First Home Guarantee Scheme
As you can see, the Home Guarantee Scheme has many benefits. You must ensure you are eligible for the scheme and ready to take advantage of the limited number of spots.
To help you do that, here is our step-by-step guide.
Step 1. Confirm Your Eligibility For the Home Guarantee Scheme
We shared the expanded eligibility criteria earlier in the article, but if you are still unsure whether you qualify, contact our dedicated team of Mortgage Brokers. At Hunter Galloway, we have helped many first-home buyers apply for the scheme.
Step 2. Check To See If You Are Buying An Eligible Property Type
The following property types are eligible for the First Home Guarantee Scheme:
- An existing house, townhouse or apartment
- A house and land package (meaning you buy the land and contract to build from the same person)
- A vacant land, together with a separate contract to build a home
- An off-the-plan apartment or townhouse
Important time frames to consider for each property type.
If you are buying an existing home, you must move into the property within 6 months of settlement. Your contract of sale must be on or after January 1 2020.
If you are buying an off-the-plan property (i.e., one that has not been built yet), you must have signed the contract before the settlement date.
If you are buying a land and house package, you will need to start building within 12 months and finish within 24 months of the settlement date of your loan.
If you are buying vacant land, you will need to enter into an eligible building contract before settlement of your home loan. You will also need to start building within 12 months and finish within 24 months of the settlement date of your loan. If you already own land and intend to get a construction loan to build the house, you will not be eligible for the home guarantee scheme.
Once you’ve been pre-approved for a home loan by one of the participating lenders, you’ll have 90 days to find and sign a contract of sale for an eligible property you want to buy.
Finally, once you’ve signed a contract of sale, you’ll have an additional 30 days from the signing date to finalise the paperwork and checks for your home loan.
Step 3. Collate the Documents Required to Apply for the Home Guarantee Scheme
You’ll need to submit the following information to your mortgage broker or a participating lender.
- Your full name and date of birth;
- Your Medicare number (including your position on the card);
- Your Notice of Assessment (NOA) for your taxable income. For reservations made from July 1 2023, to June 30 2024, the relevant NOA is for the 2022-2023 financial year.
- Other standard home loan documents.
Step 4. Determine Which Scheme You Are Applying For
The First Home Guarantee Scheme is open to those who have never owned a home or haven’t owned a home in the past 10 years. It is open to singles, couples, and anyone who wants to buy jointly.
The Family Home Guarantee, on the other hand, is only open to single parents or single legal guardians of kids, including aunts, uncles, and grandparents.
Step 5. Speak With A Mortgage Broker to Reserve Your Spot
To apply for the First Home Guarantee, you can choose to apply directly with a lender or get help from a mortgage broker.
Important: Housing Australia does not accept direct applications. You will need to work with a lender or a broker to confirm your eligibility for the scheme.
The advantage of working with a broker is that we can find you the best loan for your specific needs. Working with one specific lender will limit your options.
We can now reserve a spot for you in the First Home Guarantee. The spot is subject to availability and can be held for up to 14 calendar days. This period cannot be extended. You must submit your application within these 14 days. If it meets the requirements, we can move on to obtaining a certified guarantee.
Once you’ve been pre-approved for a home loan by one of the participating lenders, you’ll have 90 days to find and sign a contract of sale for an eligible property that you want to buy.
Finally, once you’ve signed a contract of sale, you’ll have an additional 30 days from the signing date to finalise the paperwork and checks for your home loan.
To secure a spot in the First Home Guarantee, call us on 1300 088 065 or complete our free assessment form.
What happens if all of the spots in the First Home Guarantee are taken?
If all the spots in the First Home Guarantee scheme are filled, we can put you on a waiting list. If a spot opens up, we will notify you.
Which Home Guarantee Scheme Is Right For You?
There are now three different Home Guarantee Schemes available under Housing Australia, and understanding which one applies to you can make a huge difference in your home-buying journey. Here’s a breakdown of each:
First Home Guarantee (FHGS)
This scheme allows first home buyers to purchase a home with just a 5% deposit, while the government guarantees the remaining 15%, eliminating the need to pay Lenders Mortgage Insurance (LMI). Even if you’ve owned property before, you can still be eligible as long as you haven’t owned one in the past 10 years.
Regional First Home Buyer Guarantee (RFHBG)
Designed for buyers in regional areas, this scheme also only requires a 5% deposit—but to qualify, you need to have lived in the regional area you’re buying in for at least 12 months. This is ideal for locals who want to buy where they live, work, and raise families.
Family Home Guarantee (FHG)
If you’re a single parent or legal guardian with dependents, the Family Home Guarantee could be a game-changer. It lets you buy a home with as little as 2% deposit—without LMI—even if you’re not a first-time buyer. It’s a helping hand for families trying to get back on their feet.
How Will My First Home Guarantee Loan Be Assessed?
Borrowers will be assessed based on their income, loan amount, and previous history when it comes to buying a house. For your loan to be eligible, you will need to fit the criteria, including:
- A loan is eligible if the Loan to Value Ratio (LVR) is between 80 to 95%
- The 5% deposit should be made up of genuine savings, which is money you have saved or held over 3 months.
- The property’s value doesn’t exceed the price cap for the area.
- You are applying with one of the 32 lenders that can offer the scheme.
- The loan is for a residential property, i.e. an owner-occupier loan.
- There is a maximum of two borrowers who can apply, no more.
- The residential property subject to the loan must be owner-occupied.
- The loan term does not exceed 30 years.
- Repayments must be principal and interest.
Case Study: How Much Can You Actually Save With The First Home Guarantee?
Sarah and James had been renting in Brisbane for years, watching property prices steadily rise and wondering if they’d ever be able to afford their own place. With a baby on the way and limited time to save a massive deposit, the dream of homeownership felt out of reach—until they discovered the First Home Guarantee Scheme.
They found a home they loved for $700,000, but coming up with a 20% deposit—a whopping $140,000—just wasn’t realistic. On top of that, they were staring down the barrel of an additional $39,000 in Lenders Mortgage Insurance (LMI) if they only managed a smaller deposit. All in all, buying without support would’ve cost them around $74,000 upfront, putting a serious strain on their finances.
But with the First Home Guarantee, everything changed. The scheme allowed them to purchase their home with just a 5% deposit—$35,000—and skip the LMI altogether, thanks to the government guarantee. That saved them approximately $39,000, which stayed in their bank account for moving costs, baby gear, and a small emergency buffer.
Instead of waiting years to save more—or giving up on buying entirely—Sarah and James were able to secure their first home in a growing Brisbane suburb, with confidence and financial breathing room.
Can I Switch Lenders Or Move Houses Under The Scheme?
Once you’re approved for the Home Guarantee Scheme, you’ll want to understand how flexible it is. The good news? You can refinance—but there are strict rules.
Can I Refinance My Home Loan?
Yes, but only with another participating lender. You must keep your loan amount and term the same. If you refinance with a non-participating lender or increase your loan amount, you’ll lose the government guarantee and may have to pay LMI.
What Happens If I Sell or Move Out?
The guarantee is only valid while the property is your primary residence. If you sell the home or move out and turn it into an investment property, the guarantee ends. That’s why it’s important to plan for long-term owner-occupancy.
Can I Switch Banks?
Yes—refinancing with another participating lender is allowed, but you must meet the same terms and conditions. Switching lenders outside the scheme removes the guarantee.
Key Trigger Points That End The Guarantee:
- Selling the property
- Refinancing to a non-participating lender
- Moving out
- Changing the loan to interest-only
First Home Guarantee FAQs
What is the First Home Buyer Scheme in Australia?
The First Home Buyer Scheme, officially known as the First Home Guarantee (FHBG), helps eligible Australians buy their first home with as little as 5% deposit—without paying Lenders Mortgage Insurance (LMI). It’s backed by the Australian government and managed by Housing Australia, with a limited number of spots available each year. This scheme makes it easier to break into the property market sooner, especially in high-demand areas like Brisbane.
Do you still get the First Home Buyer's Grant in Australia?
Yes, the First Home Owner Grant (FHOG) is still available—but it varies by state. For example, in Queensland, first-home buyers can receive $30,000 when building or buying a brand-new home. Each state or territory has its own rules, property price caps, and eligibility criteria, so it’s best to check with your local revenue office or speak with a mortgage broker in Brisbane who can guide you through it.
What is the 2% deposit for home loans in Australia?
The 2% deposit home loan is part of the Family Home Guarantee (FHG)—a government-backed scheme designed to support single parents with at least one dependent. It allows eligible applicants to buy a home with just a 2% deposit and no LMI. It’s a huge boost for single parents who are struggling to save while renting. Spots are limited, so getting help from a knowledgeable mortgage broker can make all the difference.
What is the minimum credit score to buy a house in Australia?
There’s no official minimum credit score to get a home loan in Australia, but most lenders prefer a score of at least 600–650. The higher your score, the better your chances of approval and securing a sharper interest rate. If your score’s on the lower end, a mortgage broker can help you find a lender that’s more flexible—or even help you improve your credit profile before applying.
What percentage do you need for a mortgage in Australia?
Most lenders require a 20% deposit to avoid paying Lenders Mortgage Insurance (LMI). However, many first-home buyers get started with just 5% deposit thanks to the First Home Guarantee (formerly known as the First Home Loan Deposit Scheme or FHLDS). Some schemes, like the Family Home Guarantee, even allow as little as 2% deposit. Working with a mortgage broker in Brisbane can help you figure out the best path based on your savings, goals, and eligibility.
Does the First Home Guarantee mean I don't need a deposit at all?
No, you still need a deposit—usually 5% of the property price (or 2% for eligible single parents under the Family Home Guarantee). The Scheme helps by removing the need for a 20% deposit and covering LMI.
Do I have to pay the government back later?
Nope! The government acts as a guarantor, not a co-owner. You won’t owe them anything extra, and you retain full ownership of your property.
Can I still apply if I've owned property before?
Yes, in some cases. If you haven’t owned a property in the last 10 years, you may still be eligible. It’s aimed at helping those re-entering the market as well as first-time buyers.
Which banks are offering the scheme?
There are currently 32 participating lenders, including major banks like CBA, NAB, Westpac, and various non-bank lenders. Each lender has limited spots. You can check the full list here.
Will I get a spot for the First Home Guarantee this year?
Spots are limited to 50,000 per year across all 32 lenders and are allocated on a first-come, first-served basis. To boost your chances, speak with a mortgage broker who can help submit your application accurately and on time.
How much deposit do I need to save under the Home Guarantee Scheme?
You need a minimum 5% deposit to be eligible, and no more than 20%. Anything above 20% means you won’t qualify for the guarantee. Also, budget extra to cover stamp duty, legal fees, and other upfront costs.
Can I combine the First Home Guarantee with other government grants or schemes?
Yes. The First Home Guarantee can be combined with other incentives like the First Home Owner Grant or stamp duty concessions, depending on your state. For example, in Queensland, homes under $700,000 may qualify for a full stamp duty exemption.
What happens if I breach the terms of the First Home Guarantee?
If you breach the scheme’s terms, the guarantee may be revoked. This could leave you responsible for LMI or other costs. Always follow the rules and consult with your broker before making any changes to your loan or living arrangements.
How is the First Home Guarantee different from other home loan schemes?
Unlike cash grants or tax offsets, the First Home Guarantee helps you buy with a smaller deposit and avoid LMI, making it easier to enter the market. It’s not a payment—it’s a guarantee on your loan.
Are there any penalties for early repayment of the loan under the scheme?
Generally, no penalties apply for early repayments under the scheme. However, some lenders may have specific rules, so always check your individual loan contract.
If I face financial difficulties in the future, is there any support or flexibility provided under the scheme?
The scheme doesn’t offer hardship support. It won’t cover missed repayments, defaults, or negative equity. Contact your lender as soon as possible if you experience financial stress—they may offer hardship assistance.
What type of home loan do I need with the First Home Guarantee Scheme?
Your loan must be for an owner-occupied property with principal and interest repayments. Interest-only loans are not eligible. Your broker can help you choose the right product with additional features.
Will I be charged higher interest rates under the First Home Guarantee?
No. Participating lenders offer standard interest rates, not inflated ones, to eligible buyers. You’ll get the same competitive rates as any other qualifying borrower.
What happens if I can't afford my repayments?
If you’re struggling, contact your lender immediately. The guarantee does not protect against missed payments or foreclosure. Early communication can help you access hardship options.
Can I get discounted interest rates under the First Home Guarantee?
Yes. Your broker can negotiate lower rates by submitting a pricing request, even under the guarantee. At Hunter Galloway, this is a standard part of our process for every client.
Can I withdraw equity from my house while on the scheme?
No. The scheme requires your loan to remain unchanged. You cannot refinance or withdraw equity during the guarantee period unless you’re switching between participating lenders under strict conditions.
What is the maximum income?
To qualify:
- Singles must earn less than $125,000 before tax
- Couples must earn less than $200,000 combined before tax
Can we qualify if my spouse is on a partner visa?
No. Both applicants must be Australian citizens or permanent residents. Partner visa holders are not eligible at this time.
Can I buy with a sibling or friend?
Yes. You can now apply jointly with a sibling, parent, or friend—not just a spouse or partner.
What if I have owned property before?
You can still qualify if you haven’t owned property in the past 10 years. The scheme was expanded to help buyers re-enter the market after a long gap.
Can I use the First Home Guarantee to build my own home?
Owner-builder contracts are not allowed. But if you’re buying land and signing a fixed-price building contract, you’re eligible under a construction loan structure.
Can I purchase the property as a trust or company?
No. You must purchase the property as an individual in your own name. Buying through a trust or company is not permitted.
Can I buy a commercial property?
No. The scheme is only for residential properties.
What type of property can I buy with the First Home Guarantee Scheme?
Eligible property types include:
- Existing homes, townhouses, or apartments
- House and land packages
- Vacant land with a building contract
- Off-the-plan apartments or townhouses
Do all participating lenders have the same criteria for the scheme?
All lenders follow the same eligibility rules, but each has unique lending criteria. A broker can help match you to the best-fit lender.
How long does the First Home Guarantee remain in place?
The guarantee stays active until:
- You sell your home
- You move out
- You refinance the loan
- Your LVR drops below 80%
Can I keep the guarantee if I switch banks?
Yes, but only if you refinance to another participating lender, keep the loan amount the same, and meet all eligibility rules. Moving to a non-participating lender will cancel the guarantee.
Do I qualify for the First Home Guarantee if I have a low credit score?
The scheme doesn’t check your credit score—but lenders do. Some lenders are more flexible with borrowers who have lower credit scores. A broker can help you find the right match.
What is the definition of a de facto partner? Do we need to show proof?
A de facto partner is someone:
- Not legally married to you
- Not related to you
- Living with you in a genuine domestic relationship
Proof isn’t required beyond signing a First Home Buyer Statutory Declaration
Do we still qualify if I've never owned property, but my spouse has?
Yes—if your spouse hasn’t owned property in the past 10 years, you may still qualify as first-home buyers.
Can I sell my home, buy another one and keep the guarantee?
No. Once you sell your home, the guarantee ends. It cannot be transferred to another property.
What happens if I need to move out and rent my property?
The guarantee requires you to live in the home. If you move out and rent it, the guarantee will be cancelled.
What happens if I have to sell my property?
If you sell, your loan is no longer covered under the scheme. The guarantee ends with the sale.
How do I know my home loan is guaranteed?
Your lender will confirm if you’ve secured a spot. Once approved, you’ll have 14 days to finalise pre-approval.
Can I apply for the scheme if I've already signed a contract to purchase a property?
It depends:
- For existing homes, your contract must be dated on or after 1 Jan 2020
- For off-the-plan, your contract must be signed before settlement and settle within 90 days of the guarantee being issued
Can I reapply if I miss out on the scheme?
Yes. As long as you still meet the criteria, you can reapply in the next round of spots.
Do I get a cash payment from the First Home Guarantee
No. This is not a cash grant—it’s a loan guarantee that helps you avoid LMI.
How do I know when my application has progressed to the next stage?
You’ll know it’s progressing when:
- Your lender confirms your spot is reserved
- You’re conditionally pre-approved
- You’ve submitted your statutory declaration form
Can I change my loan terms once it's guaranteed?
Not without refinancing, which would void the guarantee. Minor changes, such as splitting or refinancing your loan, are allowed if you remain eligible.
Do lenders' postcode restrictions still apply under the scheme?
Yes. Some lenders limit borrowing in certain postcodes. If one lender rejects your property, another may accept it. This is where a broker can help.
What happens if the valuation is higher than the price threshold?
If the bank’s valuation exceeds the scheme’s price cap, your application will be declined, even if the contract price is lower.
Bonus: What Other Government Grants Am I Eligible For?
As a first home buyer, there are many other grants available to you. You can use these schemes together with the First Home Guarantee Scheme:
- First Home Super Saver Scheme – allows you to use your super account to save for a deposit for your first home, taking advantage of the favourable tax treatment.
- First Home Owners Grant – is a once-off grant given to first homeowners to add to their deposit. It is actual cash that the government gives you.
- Stamp Duty Concessions – As a first homebuyer, you are eligible for stamp duty waivers and discounts, which can save you thousands of dollars.
Next Steps To Apply For The Home Guarantee Scheme
Ready to apply for the scheme, but don’t know where to start? Our team at Hunter Galloway will help you apply for your Home Guarantee Scheme and secure a home loan.
Unlike other mortgage brokers, who are one-person operations, we have an entire team of experts dedicated to making your home loan journey as simple as possible.
If you want to get started, please give us a call on 1300 088 065 or book a free assessment online to see how we can help.
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