When you can apply for a $200k contribution towards your first home

A housing program offering $200k to first home buyers with as little as two per cent deposit will launch in coming weeks. HOW YOU CAN CASH IN >>

A new government scheme offering a $200k contribution to first home buyers with just a two per cent deposit will launch in July with the announcement of a new banking partner – Bank of us.

The assistance includes a maximum contribution of $200,000, or 40 per cent, of the purchase price of a new home or house and land package, and up to a maximum of $150,000, or 30 per cent, for the purchase price of an existing home.

Guy Barnett, Minister for State Development, Construction and Housing said the scheme was aimed at those whom previously may have considered home ownership “seemed out of reach”.

“The new home ownership scheme might be right for you,” he said.

“From 1 July, the improved scheme provides a more generous eligibility and expanded assistance to help you build or buy your own home, with as little as a two per cent deposit.

“The shared equity scheme will help people achieve home ownership by reducing the costs of buying a home, because the costs are shared with the Director of Housing.

It means in theory an eligible applicant wanting to buy a $500,000 home could do so with a deposit as low as $10,000 and a mortgage of $300,000.

The announcement marks the transition from a current program called HomeShare, which has been supported by the Bendigo and Adelaide Bank.

Mr Barnett said the new scheme would not affect HomeShare participants who are currently funded by the Bendigo and Adelaide Bank.

Guy Barnett

“For applicants who have pre-finance approval and are waiting to find a house to purchase, finance will still be offered by Bendigo for purchases that settle up to December 31 2022,” he said.

On Friday Bank of us announced changes to its variable home loan interest rates in the wake of a recent Reserve Bank increase.

“We have decided to increase our variable home, residential investment and commercial loan interest rates by 25 basis points,” Bank of us CEO Paul Ranson said.

Bank of Us CEO Paul Ranson Picture: LUKE BOWDEN

“We have made this decision based on several factors, including our commitment to maintaining value for both our borrowers and deposit customers, and a need to be financially sustainable.”

“We understand that this will be a new experience for many borrowers. We will notify all

affected customers of the changes to their loan, and we encourage anyone who is finding it difficult to manage their loan to get in touch with us.”

The new variable rates for existing loans will come into effective June 1.