Customer owned banks hit First Home Loan Deposit Scheme milestone

Tom Watson

12 May 2020

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Over 1,000 Australian first-time buyers have already purchased homes this year under the Federal Government’s First Home Loan Deposit Scheme (FHLDS) using a customer owned bank. 

That’s according to new figures released by peak body COBA (the Customer Owned Banking Association), which show that 1,150 first home buyers have used one of their member institutions to take out a home loan as part of the initiative. 

The scheme, which kicked off on January 1, allows first home buyers to purchase a property with a deposit as low as 5% without needing to pay Lenders Mortgage Insurance (LMI) - usually a requirement for low deposit mortgages. 

COBA chief executive, Michael Lawrence said that the number of participants was encouraging, especially given the challenges thrown up by COVID-19 in the past few months. 

“COBA is delighted by this strong performance after only three months, which includes homes that have settled or where a sale contract has been signed. Our members are also supporting many more applicants who are in the process of purchasing a property,” he said.

“Buying a house is one of the biggest decisions in life, and customer owned banking institutions are specialists at helping their customers make the right decision. They support customers at every step of the way, from initial conversations to the settlement of a property.”

Customer owned banks such as Bank Australia, Defense Bank and Gateway Bank represent 20 of the 27 lenders participating in the scheme and have a share in 5,000 of the 10,000 spots available to non-major lenders. The remaining 5,000 places are allocated to the Commonwealth Bank and NAB. 

Last week, CommBank announced that 1,000 of its customers had purchased a property under the scheme, while NAB is yet to provide any figures. 

First home buyers will also have access to 10,000 new spots which will open as of July 1 for the 2020/21 financial year. 

RELATED: Neobank 86 400 slashes home loan rates, introduces $2,000 cashback offer

For more information about the FHLDS, including a full list of the participating members, check out our comprehensive First Home Loan Deposit Scheme guide. 

Otherwise to start comparing home loans for yourself, check out the hot offers in the table below, or head over to our home loan comparison table for even more deals.

Home loans 2020 - rates updated daily

  • Promoted

    Macquarie

    2.54% p.a. variable

    2.81% p.a.

    $1234

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    Offset Home Loan Package

    Handy offset account to help pay your home loan off sooner. Up to 10 offset accounts per loan account available. Fee free access at ATMs. Waived credit card annual fee. $0 international purchase fees.

    • 2.54% p.a. variable

    • 2.81% p.a.

    • $0

    • $248.00 yearly

    • $400.00

    • yes - free

    • yes - free

    • yes

    • $0

    • 70.00%

    • $150,000

    • $5,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Monthly

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    loans.com.au

    2.48% p.a. variable

    2.50% p.a.

    $1234

    Product details Close details
    Smart Home Loan 80

    A low-rate home loan that could save you thousands, with no ongoing fees plus unlimited extra repayments and free redraws. Mozo Experts Choice Low Cost Home Loan 2020.^ You'll need to be borrowing $1 million or less and have at least a 20% deposit required.

    • 2.48% p.a. variable

    • 2.50% p.a.

    • $520

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • Optional - with 0.10% additional interest

    • $520

    • 80.00%

    • $50,000

    • $1,000,000

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    HSBC

    2.09% p.a.
    fixed 2 years

    2.98% p.a.

    $1234

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    Fixed Rate Home Loan

    Have the security of a fixed rate for 2 years with the option to split with one of the HSBC variable Home Loans. No ongoing monthly service fees or annual fees. Mozo Experts Choice Fixed Home Loan 2020^

    • 2.09% p.a.
      fixed 2 years

    • 2.98% p.a.

    • $0

    • $0.00

    • $300.00

    • yes - free up to $10,000 p.a.

    • no

    • no

    • $0

    • 80.00%

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    Athena

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    Celebrate Variable Home Loan

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    • no

    • $0

    • 60.00%

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    UBank

    2.49% p.a. variable

    2.49% p.a.

    $1234

    Product details Close details
    UHomeLoan - Discount Offer

    Enjoy a super low rate, $0 fees and easy application with the Mozo Experts Choice Home Lender Bank of the Year.^ Free redraw with flexible repayments. Min 20% deposit.

    • 2.49% p.a. variable

    • 2.49% p.a.

    • $0

    • $0.00

    • $0.00

    • yes - free

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    • $0

    • 80.00%

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    • Variable

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*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 the amount and term you entered.

**Initial monthly repayment figures are estimates only, based on the advertised rate, and a loan of $500,000 repaid over 25 years. 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.

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