When you’d like to move out from living at home or from a rented accommodation and purchase your first property, there are many good reasons to take advantage of the First Home Owners Grant to give you a boost towards your savings.The Western Australian state version of this government policy has seen grants totalling over $1,800 million passed over to first home owners since its inception.
Your mortgage brokers in Rockingham know all about the grant and will be pleased to help you learn more as part of your mortgage application process.
How Does it Work?
Essentially, someone is giving you $7000 and you don’t have to do much in return. As there is no tax to pay on the grant and it is not means tested you may never get a second chance be able to receive such a kind gift but there are some rules you should follow, such as you’ll never be able to claim twice.
You can’t have owned a property in Australia before, be over the age of 18 and lived in the country for at least six months. The property you want to buy can be a new or an established home. If your spouse or partner has received this grant before, you won’t be able to receive it again as part of a joint application for a mortgage. To make sure that you don’t have to repay the grant, one of you must live in the property for a continuous period of at least six months and this must start within the first year after you bought the home.
During the global financial crisis, the grant was doubled to $14,000 but it has since returned to $7000, so if you’re talking to people with out of date information, don’t think you can get $14,000 currently. Some people claim that the grant inflated the first home buyers’ market because sellers knew the potential purchasers could receive $7000 for free and therefore, overstated their prices.
There is a limit to the size of property that you can be buying under this scheme but this isn’t a worry for most first time buyers as the maximum home and land value can be $750,000 but if you intend to buy over the 26th parallel, the maximum moves up to $1 million.
Under normal circumstances, the grant will be paid direct to your mortgage lender, which is a good way to begin your home purchase. If you’re going through the process of buying a new home, the grant will usually be approved and sent to your lender when settlement occurs.
The Homebuyers Assistance Account
The Real Estate and Business Agent Supervisory Board can also pass over a grant of up to $2000 for incidental expenses for first home buyers if you’re buying a completed house or a partially built home but it must be through a licensed real estate agent and valued at $400,000 or less.
Your mortgage brokers in Baldivis will be able to help first home owners to find out if they can gain access to the grants and how they can be applied to the purchase of a property.