The latest figures for the FHLDS suggest that brokers assisted in up to 50 per cent of placements within the scheme, as associations urge brokers to prepare FHB clients for 10,000 more places to open.
Government figures show that brokers facilitated 50 per cent of all places in the government’s First Home Loan Deposit Scheme from 1 February 2020, when the non-major lenders began accepting applications, and NAB accepted applications through the third-party channel.
When January is included in the calculations (when only Commonwealth Bank was accepting applications from the broker channel), brokers contributed to 44 per cent of all scheme placements, making it the most popular introduction channel in the scheme overall.
Noting the significant contribution of brokers to the scheme, both the Finance Brokers Association of Australia (FBAA) and the Mortgage & Finance Association of Australia (MFAA) have urged brokers to be proactive with their first home buyer clients, prior to the release of 10,000 new scheme places on 1 July 2020.
FBAA managing director Peter White noted that places under the scheme aren’t likely to last long, with initial places in the scheme reserved within four months of launching in January.
“The places that were available in January have gone, and due to the wider knowledge of the scheme, I’d expect the new 10,000 will be taken within a few months,” Mr White said.
He also reminded brokers that borrowers will be required to provide a copy of the notice of assessment from the current 2019-20 year as evidence of their taxable income, which means that borrowers looking to secure a spot in scheme in the July release will need to have their tax return filed as soon as they can.
The FHLDS requires eligible borrowers to have a taxable income of no more than $125,000 for individual applicants and no more than $200,000 for couples, and requires the Notice of Assessment from the previous financial year as evidence of this.
“This is the time to be working with borrowers to ensure they are ready to do their tax returns quickly or they may miss out,” Mr White said.
Mike Felton, CEO of the MFAA, also stated that it is vital for brokers to be proactively working with clients to ensure that they can secure place within the scheme in a timely fashion.
“With a further release of 10,000 places on 1 July, it is essential for brokers to prepare their prospective clients by explaining the process and the importance of submitting their tax return early, given the requirement to have a Notice of Assessment from the previous financial year as evidence of their taxable income,” Mr Felton said.
While word is yet to come regarding which lenders will be participating in the second round of the scheme, Mr Felton added that the association is working to ensure that broker participation in the scheme can be expanded.
“The MFAA is engaged in ongoing dialogue with NHFIC to ensure that the lender panel on the scheme can increasingly be utilised by brokers and that brokers continue to be acknowledged as an important channel in providing access to the scheme, thereby maximising the opportunity for first home buyers to purchase a property,” he said.
Mr Felton added: “We are delighted that FHLDS places have increasingly been provided to customers who have applied for their home loan via brokers. Since 1 January, the number of applicants accessing the scheme through brokers has increased, moving towards a balance that is more representative of current broker market share.”
[Related: FHB deposit scheme officially launches]
Hannah Dowling is a journalist for The Adviser and Mortgage Business.
Prior to joining Momentum Media, Hannah worked as a content producer for a podcast catering to property investors. She also spent six years working in the real estate sector at a local agency.
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