Customer-owned banks take the spotlight as First Home Loan Deposit Scheme enters second month

By Niko Iliakis · · 2 min read
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The government’s First Home Loan Deposit Scheme is due to be rolled out February 1, and customer-owned banks are experiencing a surge in interest.

Of the 27 names which make up the scheme’s panel of lenders, 20 are customer-owned. They will be competing for 5,000 of the 10,000 home loans that have been allocated to non-major bank lenders as part of the scheme.

Michael Lawrence, Chief Executive Officer of the Customer Owned Banking Association, said customer-owned banks have a long tradition of helping first homeowners enter the property market, thanks to their competitive pricing and dedicated customer service.

“Customer owned banking institutions have been helping prospective first home buyers with assembling documentation and preparing applications to help with timely lodgements from 1 February,” he said. 

What is the First Home Loan Deposit Scheme?

The First Home Loan Deposit Scheme is a government initiative which will help 10,000 eligible first home buyers purchase a home sooner by guaranteeing up to 15% of their home loan, allowing them to avoid paying Lenders Mortgage Insurance altogether.

A lack of a sizable deposit has long been one of the main barriers for Australians looking to buy a home. By allowing Australians to purchase a home with just a 5% deposit, the scheme hopes to help low and middle income earners who have up till now felt priced out of the property market.

Already 3,000 spots have been snapped up within a single week in January, and pre-approvals are expected to continue at a rapid pace. The good news is that a further 10,000 spots will be made available mid-2020.

“With the scheme going on, the area of the market that it occupies could start to move up, and this may pressure other first home buyers to hop onto the bandwagon as well,” said Mozo’s property expert, Steve Jovcevski. 

Which customer-owned banks have signed on?

So which customer-owned institutions have been selected by the National Housing Finance and Investment Corporation (NHFIC) as panellists for the First Home Loan Deposit Scheme? The list includes the following:

  • Australian Military Bank
  • Bank Australia
  • Bank First
  • Bank of us
  • Beyond Bank Australia
  • Community First Credit Union
  • CUA
  • Defence Bank
  • Gateway Bank
  • G&C Mutual Bank
  • People’s Choice Credit Union
  • Police Bank (including the Border Bank and Bank of Heritage Isle)
  • P&N Bank
  • QBANK
  • Queensland Country Credit Union
  • Regional Australia Bank
  • Sydney Mutual Bank and Endeavour Bank
  • Teachers Mutual Bank Limited (including Firefighters Mutual Bank, Health Professionals Bank, Teachers Mutual Bank and UniBank)
  • The Mutual Bank
  • WAW Credit Union.

If you’d like to see how the above lenders stack up against larger lenders, head over to our home loan comparison page for an idea. And if you’re after more tips on entering the property market, be sure to browse our first home buyer guides.

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Last updated 30 October 2024 Important disclosures and comparison rate warning*

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    Lock in a low 2 year fixed rate with the Mozo award winning Home Lender of the Year. Available for live-in borrowers with just a 10% deposit required. Free extra repayments (up to 20% in fixed period), free redraw and partial offset available. $10 monthly service fee. Aussie support centre. Fast approvals. Up to 6 free offset accounts (T&Cs apply).

  • Fixed Home Loan

    • Owner Occupier
    • Principal and Interest
    Interest rate
    5.54 % p.a.
    Fixed 2 years
    Comparison rate
    5.93 % p.a.
    Initial monthly repayment
    $4,106
    Go to site

    Competitive fixed rate on up to a 30 year loan term. No application fees to pay. Additional repayments up to $20,000 per year without penalty. Free online redraw. Optional 100% offset feature ($10/month) 10% minimum deposit. Fees & charges apply, Australian Credit Licence 237879 is held by Bendigo and Adelaide Bank Limited, the credit provider.

  • Fixed Express Home Loan

    • Owner Occupier
    • Principal & Interest
    Interest rate
    5.54 % p.a.
    Fixed 2 years
    Comparison rate
    6.11 % p.a.
    Initial monthly repayment
    $4,106
    Go to site

    Lock in a low 2 year fixed rate with the Mozo award winning Home Lender of the Year. Available for live-in borrowers with just a 10% deposit required. Free extra repayments (up to 20% in fixed period), free redraw and partial offset available. $10 monthly service fee. Aussie support centre. Fast approvals. Up to 6 free offset accounts (T&Cs apply).

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    Competitive variable rate on up to a 30 year loan term. No application fees to pay. Unlimited additional repayments. Free online redraw. Optional 100% offset feature ($10/month) 10% minimum deposit. Fees & charges apply, Australian Credit Licence 237879 is held by Bendigo and Adelaide Bank Limited, the credit provider.

  • Express Home Loan

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    Enjoy competitive rates for owner occupiers. Enjoy unlimited free extra repayments. Flexibility to redraw additional payments for free. No ongoing monthly service fee. Settlement fee waived on new borrowings from $50,000 (T&Cs apply).

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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 $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. 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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