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Government Help For Single Parents to Buy A Home

Family Home Guarantee Scheme

Geared towards single parents, the scheme will support up to 10,000 divorced or separated parents with dependent children over the next 4 years. Eligible applicants only need a 2% deposit and are NOT limited to first home buyers, recognizing that many single parents may have previously owned a property. Price caps apply.

Successful applicants can purchase varying types of properties (units or houses), or can choose to build or buy an already established property providing they meet the eligibility criteria:

Income test: Maximum annual income for the FHG is $125,000 (the same as the First Home Loan Deposit Scheme) in the preceding financial year. Child support payments are excluded from this income cap.

Prior Ownership Test: The single parent can’t currently own property but can previously have owned property. This scheme is not limited to first home buyers.

Citizenship Test: Applicants must be Australian citizens and must be 18 years or older.

Deposit Requirement: The single parent must have a minimum 2 per cent deposit. That means you must have savings of 2 per cent of the price of the home to be bought. The government will guarantee up to 18 per cent of the property purchase price, allowing the applicant to get a loan without paying LMI.

Owner Occupier test: The single parent is the only person listed on the title and the loan and must live in the home.

Type of Housing: You can purchase a new or existing dwelling worth up to the price caps (listed below).

Can both parents apply for the Family Home Guarantee? Yes, both ex-partners of the same children apply for this scheme according to the spokeswoman for the Assistant Treasurer. You don’t need to show 50 per cent or more care of the child(ren) but you will need to demonstrate some care/custody of the children. The spokeswoman suggested at least 10 per cent might be required.

And if you’re not a Single Parent, the First Home Loan Deposit Scheme is for first home buyers only who are either building or buying an existing property to live in.

The scheme has been running since October 2020 and has been extended until the end of the 2021/2022 financial year. Eligibility requirements and more information can be found here: https://www.nhfic.gov.au/media/1713/family-home-guarantee-fact-sheet-july-2021.pdf

Written by Jason Pestano