The National Housing Finance and Investment Corporation has seen strong interest from brokers as it seeks feedback on the implementation of the First Home Loan Deposit Scheme.
Residential mortgage lenders have expressed strong interest in a three-week “market sounding process” conducted by the National Housing Finance and Investment Corporation (NHFIC) as part of its consultation process on the federal government’s new First Home Loan Deposit Scheme (FHLDS).
Prime Minister Scott Morrison announced the FHLDS prior to the federal election earlier this year. As part of the proposal, the government said it would partner with private lenders and prioritise small lenders in an effort to ramp up competition.
In anticipation of the scheme’s launch, which will come into effect on 1 January 2020, the NHFIC said it would begin detailed consultations with lenders regarding their potential participation in the scheme. It sought feedback from lenders on its implementation, with all residential mortgage lenders welcome to participate.
More than 100 residential mortgage lenders and registered brokers participated in the market sounding process.
NHFIC chief executive Nathan Dal Bon said it had received 23 responses to the Market Sounding Scheme Features Paper so far, with the corporation now reviewing the feedback as it moves into the next phase of developing and implementing the scheme.
“We were pleased to see such a broad range of market participants engage with NHFIC throughout the process,” Mr Dal Bon said.
“Residential mortgage lenders of all sizes and types from right around the country with significant regional and metropolitan reach participated in the market sounding.
“The market sounding process was an important step in preparation for implementing the First Home Loan Deposit Scheme on 1 January next year, subject to the passage of legislative amendments currently before the Parliament.”
The $500-million scheme proposes to enable access to 95 per cent loan-to-value ratio mortgages to first home buyers should they have a deposit of at least 5 per cent.
Legislative amendments to establish the scheme were introduced to Parliament on 13 September. The legislation involves the amendment of the National Housing Finance and Investment Act 2018 to incorporate the functionality of the FHLDS, as well as providing the framework for the NHFIC to conduct its own research into housing affordability, including supply and demand.
Subject to the passage of these amendments, NHFIC intends to begin a procurement process that it will use to establish a panel of lenders to participate in the scheme.
[Related: RBA reveals FHB deposit scheme calculations]
Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.
Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.
The major brokerage has reported a record increase in home loan p...
The social media giant has commenced processing applications for ...
Purple Circle Financial Services has reported a record increase i...