Home Loan Schemes, Grants And Support
How could you get into your own home sooner?
Saving for a 20% deposit or paying Lenders Mortgage Insurance (LMI) if your deposit is under 20% can be a barrier to home ownership, but with a bit of help, you could fast-track your dreams.
Option 1: Home Guarantee Scheme (HGS)
Low deposit
Shave years off the usual time it would take to save, with a low deposit of 2-5%.
No LMI
No Lenders Mortgage Insurance means you could save thousands.
Sweet rate
Benefit from interest rates normally reserved for deposits of 20% or more.
Choose from one of three guarantees that offer a low deposit and no requirement for Lenders Mortgage Insurance (LMI). To decide which of the 3 guarantees is the right fit, tell us who you are:
Family Home Guarantee
Minimum 2% deposit and no LMI
You are: Single parent or single legal guardian with at least one dependent child.
Regional First Home Buyer Guarantee
Minimum 5% deposit and no LMI
You are: Eligible home buyer purchasing in a regional area.
First Home Guarantee
Minimum 5% deposit and no LMI
You are: Eligible home buyer purchasing a home sooner.
Option 2: First Home Owner Grant
Don't quite have all your deposit saved or could you use a cash injection to help with some of your home-buying or building expenses? A one-off $10,000 First Home Owner Grant could be what you're looking for.
Tip
You may be eligible for this grant on top of one of the other schemes or support options. Our lending specialists can help you understand the eligibility criteria and answer your questions.
Book an appointment
Option 3: Other support opportunities
LMI Waiver for Professionals: low 5-10% deposit and no LMI
You are: A nurse, midwife, medical practitioner, veterinary practitioner, pharmacist, emergency services worker, or one of 17 other occupations.
Family Security Guarantee (Using a guarantor)
You have: A family member who’s willing to guarantee the loan, so you can reduce your loan to value ratio (LVR) to under 80%, meaning you won’t pay LMI.
Lenders Mortgage Insurance (LMI)
You are: Not eligible for a grant or scheme but still want to purchase a home with a deposit of less than 20%. LMI might be a workable option.
Need help with finding the right option?
Book a no-obligation appointment with one of our lending specialists. They can answer all your questions and, if you choose to proceed, walk you through the whole process.
Frequently asked questions
Lenders Mortgage Insurance (LMI) will NOT be applicable if your loan is supported by a guarantee under the Home Guarantee Scheme, but so that you understand what it is, it’s a charge that most lenders require if a home loan deposit is less than 20%. This protects the lender if you can’t repay the loan. It can either be added to your loan or paid upfront.
There are two parts to a home loan balance:
- The principal amount is how much you have borrowed.
- The interest is an amount your lender charges you based on your principal. It's calculated daily as a percentage (your interest rate) of your principal and added to your balance every month.
Principal and interest repayments pay off the amount you borrowed (the principal) and the interest, plus any fees.
By the end of the loan term (up to 30 years), you will have repaid the amount borrowed and the total interest owed, meaning your home will be mortgage-free.
We calculate your interest in two steps.
First, we multiply the balance on your loan by your interest rate and divide by 365 days in a year. This shows your daily interest charges.
We then add together your daily interest charges for every day in each month, which produces the monthly interest charge shown on your statement.
Finally, we divide this up according to your preferred repayment frequency, whether that’s weekly, fortnightly or monthly. This figure is your repayment amount.
If your loan balance was $500,000 with an interest rate of 4.93% p.a. and monthly repayments, the calculation might look like this:
500,000 x 0.0493 / 365 = $67.53 interest per day
$67.53 x 30 days in September = $2,026 interest for September
You can use our Mortgage Repayment Calculator to estimate repayments and interest charges over the life of a loan. You can also use the calculator to check the effect that extra repayments could have on your home loan.
Planning to use an offset account? Calculate how much interest you could save.
Variable interest rate
With a variable rate home loan, your variable rate changes in line with market interest rates. Choose from our basic loan and standard home loan with offset - and get ahead on your home loan with no cap on extra repayments and no associated break costs.
Fixed interest rate
With fixed rate home loans, your fixed rate won’t be affected by interest rate rises during your 1-5 fixed rate period – so you'll know exactly what your interest rate and repayments will be throughout your fixed rate loan term.
Split your home loan account
Or you can get the best of both worlds by splitting your balance into separate variable and fixed rate loan amounts.
Many things affect how fast you can pay down your home loan balance, and how much interest you pay.
Extra repayments. The simplest way to pay off your loan sooner is to make additional repayments on top of the repayments you’re obliged to make. Bear in mind, if you have a fixed rate with us, you can only make up to $30,000 in additional repayments during the fixed rate period, before break costs apply.
Repayment type. You'll need to pay principal and interest repayments (P&I) if you're eligible for one of the guarantees under the Home Guarantee Scheme, meaning you'll pay off both parts of your home loan (the principal loan amount, plus interest). Read more about repayment types.
Weekly or fortnightly repayments. Choosing the right repayment frequency can make a difference over time, as well – choosing true fortnightly repayments when you apply will allow you to make the equivalent of one extra repayment per year, given there are 26 fortnights in a year.
Offset. If you link an offset account to your Rocket variable home loan, depositing your savings into this account will help to reduce the interest payable on your principal. Calculate how much you could save with an offset account.
Home (also known as Building) Insurance covers your home’s physical structures and fixtures, including your garage, fences and paved driveways. It also includes built-in appliances like hot water systems and air-conditioners.
Contents Insurance covers personal belongings at your home, like your furniture, carpet, appliances and clothing. It also includes your BBQ, outdoor furniture and kid’s play equipment.
Yes, it could affect your eligibility as during the entire period that the guarantee is in place, you must:
- Continue to live in the purchased property as an owner-occupied property
- Make principal and interest repayments (except during the construction phase of building a new home)
- Not increase the loan term or loan amount.
For more details, please refer to the relevant Information Guide on the Housing Australia website.
Things you should know
Home Guarantee Scheme eligibility criteria apply. Conditions, credit criteria, fees and charges apply. Based on Westpac's credit criteria, residential lending is not available for Non-Australian Resident borrowers. This information has been prepared without taking your objectives, needs and overall financial situation into account. For this reason, you should consider the appropriateness of the information and, if necessary, seek appropriate professional advice.
Once our allocation of loans under the scheme has been exhausted, standard lending approval criteria, including the need for LMI and LDP where appropriate, will apply.
You can find more information about the HGS on the Housing Australia website.
First Home Owner Grant: eligibility criteria apply. To find out more visit the First Home Owner Grant website.
Family Security Guarantee: The guarantor should consider the risks associated with the Family Security Guarantee, primarily that if the borrower defaults on their loan, the guarantor is liable to pay up to the maximum of the portion of security they have put forward as a guarantee. You will be required to seek independent legal advice before offering to guarantee a loan. Credit criteria apply to the assessment of the adequacy of any proposed guarantee limit.
Offer available on all loans eligible under the Family Security Guarantee, for purchase or refinance of owner occupier or investment property. Note that for investment properties, the borrower must not have ownership of any other properties at the time of application, and for owner occupied properties a maximum of one other property may be owned which does not have sufficient equity to provide a security. For new Family Security Guarantee Home Loan applications received from 23 October 2020. Family Security Guarantee can be provided by parents or legal guardians, siblings, and children. Equity access, owner builder applications, Line of Credit and Bridging Loan products are not eligible under the Family Security Guarantee. Other Exclusions may apply. Not available for the purposes of debt consolidation, owner builder construction, cash out, or addition of a security guarantee to an existing loan. $150k minimum loan size applies. Credit criteria, fees and charges apply. Offer may be varied or withdrawn at any time. Full eligibility criteria on the Family Security Guarantee is available on request.
Lenders mortgage insurance (LMI) is issued to Westpac Banking Corporation ABN 33 007 457 141 (Westpac) and insurers Westpac (it is not insurance you take out). This information does not take into account your personal circumstances. Terms, conditions and limitations apply.