With 1 February less than two weeks away — the date select non-major lenders can submit applications under the First Home Loan Deposit Scheme (FHLDS) — one participant has urged brokers to act swiftly, but with caution, in order to ensure the best outcome for all parties.
MyState Bank is now taking home loan applications for pre-approval ahead of the February launch, which has set aside 5,000 of the 10,000 loans available through the FHLDS this financial year to non-major lenders.
“We are urging mortgage brokers to check their customer base and act quickly to submit home loan applications pre-approval for eligible customers now, as places in the scheme are limited and allocated on a ‘first in’ basis," he said.
According to the lender, "getting the application right is critical", with MacRae calling for brokers "to be extra diligent" when submitting applications under the scheme and pay attention to the guidelines regarding property price thresholds, customer incomes and other criteria.
“Failure to submit supporting documentation as well as any further information required completely and accurately can result in customers missing out on their place, which isn’t a good outcome for either party,” he said.
“We expect heightened demand for this scheme to continue with Australia’s housing market prices predicted for an upswing in 2020, amid further potential rate cuts and a friendlier lending environment relative to previous years."
MyState will also offer a 0.05% discount on its lowest advertised basic variable rate for home loans with an LVR of up to 95%, as well as waive the establishment fee for eligible customers, in addition to the "competitive fixed rate options" on offer for scheme-approved customers.
Gateway Bank is also now accepting expressions of interest for customers looking to obtain a place in the scheme.
“With 5,000 places available to non-major lenders and only 2,000 further places available for the major banks, customers may be more likely to get a scheme place by choosing a non-major lender,” said Ryan Holman, head of product and pricing at Gateway.
Holman emphasised that even customers who have already been pre-approved with one of the major banks can transfer their place in the scheme to a more competitive lender.
“Just remember that the date the reservation or pre-approval ends will not reset and, of course, once the places are gone the next round won’t be available until the next financial year,” he said.
