Buying a home with a 5% deposit - scheme to offer more spots under 2021 Budget

An additional 10,000 places under the First Home Loan Deposit Scheme (FHLDS) for new builds will become available from July 1 following an announcement made as part of the 2021 Federal Budget.
This is the second allotment of places released under the New Homes Guarantee version of the Federal Government’s FHLDS which will be available to eligible first home buyers specifically looking to build or purchase a new home.
It adds to the previously announced addition of 10,000 places for existing home purchases under the scheme that will also become available from July 1.
The scheme is designed to help first time buyers with low deposits (as low as 5%) purchase property without needing to take out lenders mortgage insurance.
Instead, the government will ‘guarantee’ home loans used for the purchase which can be taken out through 33 participating lenders including major banks like the Commonwealth Bank and NAB as well as a number of customer owned institutions.
“We commend the Government for embedding competition into the successful FHLDS. Ensuring the strong representation and prioritisation of customer owned lenders has led to greater choice and outcomes for consumers,” said COBA chief executive, Michael Lawrence, on the further expansion of the scheme.
Further budget measures for home buyers
In addition to the continuation of the First Home Loan Deposit Scheme, the 2021 Federal Budget will also target home buyers with the rollout of the Family Home Guarantee scheme and a beefed up First Home Super Saver Scheme (FHSSS).
The new Family Home Guarantee initiative is aimed at assisting single parents get into the property market with a home loan deposit as low as 2%.
Like the FHLDS, the Federal Government will play guarantor under the new scheme, allowing eligible applicants to borrow with a deposit under 20% without having to take out lenders mortgage insurance.
An initial 10,000 places will be available under the scheme which will start on July 1, 2021 and run for four years.
Treasurer Josh Frydenberg also announced that voluntary super contributions made under the First Home Super Saver Scheme (FHSSS) would be expanded from the current maximum of $30,000 to $50,000.
The scheme allows prospective first home buyers to save up for a deposit by making voluntary contributions to their superannuation which can then be pulled out later on.
RELATED: Budget 2021: Low and middle income tax breaks expected for another year
For more of a breakdown on the 2021-22 Federal Budget, including the housing measures above, check out the latest episode of The Finance Burrito podcast!
Or if you're on the hunt for your first property then head on over to our first home buyer comparison tables to compare a range of home loan options, or check out some of the hot offers in the table below.
Compare home loans - last updated 20 August 2022
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Variable Home Loan 70
interest rate
comparison rate
Initial monthly repayment3.10% p.a. variable3.12% p.a.Affordable home loan rate for buyers or refinancers.. No monthly or ongoing fees. Option to add an offset for 0.10%. Access to savings with unlimited redraws available. Minimum 30% deposit required.
CompareCompareVariable Home Loan 70
Affordable home loan rate for buyers or refinancers.. No monthly or ongoing fees. Option to add an offset for 0.10%. Access to savings with unlimited redraws available. Minimum 30% deposit required.
- interest rate
- 3.10% p.a. variable
- comparison rate
- 3.12% p.a.
- interest rate
- 3.10% p.a. variable
- comparison rate
- 3.12% p.a.
- Upfront fees
- $520
- Ongoing fees
- $0.00
- Discharge Fee
- $0.00
- Extra repayments
- yes - free
- Redraw facility
- yes - free
- Offset account
- yes
- Maximum loan to value ratio
- 70.00%
- minimum borrowing amount
- $50,000
- maximum borrowing amount
- $2,000,000
- type of mortgage
- Variable
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special Offers
Read our Mozo Review to learn more about the Variable Home Loan 70
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Unloan Variable
Owner Occupier, Refinance Only
interest rate
comparison rate
Initial monthly repayment3.14% p.a. variable3.06% p.a.For refinancers only. Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply in as little as 10 minutes.
CompareCompareUnloan Variable
For refinancers only. Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply in as little as 10 minutes.
- interest rate
- 3.14% p.a. variable
- comparison rate
- 3.06% p.a.
- interest rate
- 3.14% p.a. variable
- comparison rate
- 3.06% p.a.
- Upfront fees
- $0
- Ongoing fees
- -
- Discharge Fee
- $0.00
- Extra repayments
- yes - free
- Redraw facility
- yes - free
- Offset account
- no
- Maximum loan to value ratio
- 80.00%
- minimum borrowing amount
- $10,000
- maximum borrowing amount
- $3,000,000
- type of mortgage
- Variable
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special Offers
Read our Mozo Review to learn more about the Unloan Variable
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Featured Product
Neat Home Loan
Owner Occupier, Principal & Interest, LVR <60%
interest rate
comparison rate
Initial monthly repayment3.64% p.a. variable3.66% p.a.Low variable rate No annual fees to pay. Unlimited additional repayments. Free redraw facility available. Fast digital application. 40% deposit required. Winner of Mozo Experts Choice Australia's Best Essential Bank 2022^.
CompareCompareNeat Home Loan
Low variable rate No annual fees to pay. Unlimited additional repayments. Free redraw facility available. Fast digital application. 40% deposit required. Winner of Mozo Experts Choice Australia's Best Essential Bank 2022^.
- interest rate
- 3.64% p.a. variable
- comparison rate
- 3.66% p.a.
- interest rate
- 3.64% p.a. variable
- comparison rate
- 3.66% p.a.
- Upfront fees
- $250
- Ongoing fees
- $0.00
- Discharge Fee
- $300.00
- Extra repayments
- yes - free
- Redraw facility
- yes - free
- Offset account
- no
- Maximum loan to value ratio
- 60.00%
- minimum borrowing amount
- $80,000
- maximum borrowing amount
- $5,000,000
- type of mortgage
- Variable
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special Offers
Read our Mozo Review to learn more about the Neat Home Loan
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Celebrate Variable Home Loan
<60% LVR, Owner Occupier, Principal & Interest
interest rate
comparison rate
Initial monthly repayment3.79% p.a. variable3.79% p.a.Fast and efficient online application. Automatic discounts as loan is paid down. Free extra repayments and redraw facility. Zero fees. Min 40% deposit required.
CompareCompareCelebrate Variable Home Loan
Fast and efficient online application. Automatic discounts as loan is paid down. Free extra repayments and redraw facility. Zero fees. Min 40% deposit required.
- interest rate
- 3.79% p.a. variable
- comparison rate
- 3.79% p.a.
- interest rate
- 3.79% p.a. variable
- comparison rate
- 3.79% p.a.
- Upfront fees
- $0
- Ongoing fees
- $0.00
- Discharge Fee
- $0.00
- Extra repayments
- yes - free
- Redraw facility
- yes - free
- Offset account
- yes
- Maximum loan to value ratio
- 60.00%
- minimum borrowing amount
- $100,000
- maximum borrowing amount
- $2,000,000
- type of mortgage
- Variable
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special Offers
Read our Mozo Review to learn more about the Celebrate Variable Home Loan
-
Featured Product
Neat Home Loan
Owner Occupier, Principal & Interest, LVR 60-70%
interest rate
comparison rate
Initial monthly repayment3.74% p.a. variable3.76% p.a.Low variable rate. No annual fees to pay. Unlimited additional repayments. Free redraw facility available. Fast digital application. 30% deposit required.
CompareCompareNeat Home Loan
Low variable rate. No annual fees to pay. Unlimited additional repayments. Free redraw facility available. Fast digital application. 30% deposit required.
- interest rate
- 3.74% p.a. variable
- comparison rate
- 3.76% p.a.
- interest rate
- 3.74% p.a. variable
- comparison rate
- 3.76% p.a.
- Upfront fees
- $250
- Ongoing fees
- $0.00
- Discharge Fee
- $300.00
- Extra repayments
- yes - free
- Redraw facility
- yes - free
- Offset account
- no
- Maximum loan to value ratio
- 70.00%
- minimum borrowing amount
- $80,000
- maximum borrowing amount
- $5,000,000
- type of mortgage
- Variable
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special Offers
Read our Mozo Review to learn more about the Neat Home Loan
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Smart Booster Home Loan
2 Year Discounted Variable Rate, Owner Occupier, Principal & Interest, <80% LVR
interest rate
comparison rate
Initial monthly repayment3.60% p.a.variable for 24 months and then 4.00% p.a. variable3.96% p.a.Already includes July RBA rate increase. New super low introductory rate home loan for two years. Min 20% deposit. No monthly or ongoing fees. Fast settlement times. Mozo award-winning online lender. Friendly, local Australian based team.
CompareCompareSmart Booster Home Loan
Already includes July RBA rate increase. New super low introductory rate home loan for two years. Min 20% deposit. No monthly or ongoing fees. Fast settlement times. Mozo award-winning online lender. Friendly, local Australian based team.
- interest rate
- 3.60% p.a.variable for 24 months and then 4.00% p.a. variable
- comparison rate
- 3.96% p.a.
- interest rate
- 3.60% p.a.variable for 24 months and then 4.00% p.a. variable
- comparison rate
- 3.96% p.a.
- Upfront fees
- $520
- Ongoing fees
- $0.00
- Discharge Fee
- $0.00
- Extra repayments
- yes - free
- Redraw facility
- yes - free
- Offset account
- Optional - with 0.10% additional interest
- Maximum loan to value ratio
- 80.00%
- minimum borrowing amount
- $50,000
- maximum borrowing amount
- $2,000,000
- type of mortgage
- Variable
- Repayment types
- Principal & Interest
- Availability
- Owner Occupier
- Repayment options
- Weekly, Fortnightly, Monthly
- Special Offers
Read our Mozo Review to learn more about the Smart Booster Home Loan
* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.
** Initial monthly repayment figures are estimates only, based on the advertised rate, loan amount and term entered. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.
^See information about the Mozo Experts Choice Home Loan Awards
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