Can a Mortgage Broker Help Me Access the First Home Guarantee in Victoria?

By Lowest Interest Rates Australia

Introduction

When I first heard about the First Home Guarantee, I thought it sounded too good to be true. “Buy a home with just 5% deposit and no Lenders Mortgage Insurance? Surely there’s a catch,” I remember thinking as I scrolled through listings in Melbourne with a coffee in hand. Like many first-home buyers in Victoria, I had a dream home in mind but not quite enough savings to make it happen. That’s when I discovered the magic words: ‘Talk to a mortgage broker.’

If you’ve been wondering whether a mortgage broker can actually help you access the First Home Guarantee (FHG) and navigate the confusing world of eligibility, applications, and lenders — you’re in the right place. In this article, I’ll break down exactly how brokers can simplify the process, boost your chances of approval, and help you finally unlock the door to your first home in Victoria.

Table of Contents

1. Understanding the First Home Guarantee (FHG)
2. Eligibility Criteria for the FHG in Victoria
3. How the Scheme Works
4. The Role of a Mortgage Broker in the Process
5. Benefits of Using a Mortgage Broker
6. Documents You’ll Need to Apply
7. Which Lenders Offer the First Home Guarantee?
8. Common Mistakes First-Home Buyers Make
9. Example of How a Broker Can Help
10. Why You Shouldn’t Go It Alone
11. Final Thoughts — Partner with Lowest Interest Rates

Understanding the First Home Guarantee (FHG)

The First Home Guarantee (formerly the First Home Loan Deposit Scheme) is a federal government initiative designed to help first-time buyers get into the property market faster. Managed by Housing Australia, the scheme allows eligible buyers to purchase a home with as little as a 5% deposit — without paying Lenders Mortgage Insurance (LMI).

Here’s how it works: the government essentially “guarantees” up to 15% of your loan amount, making up the difference between your 5% deposit and the 20% typically required by lenders. This guarantee gives banks the confidence to lend to you, even if your deposit is smaller than usual.

In Victoria, where housing affordability can be a major challenge (especially in Melbourne’s suburbs), this scheme can be a game-changer for those struggling to save that elusive 20% deposit.

Eligibility Criteria for the FHG in Victoria

Before you get too excited, it’s important to check whether you qualify for the scheme. The eligibility requirements for Victorians are set nationally but apply state by state. As of 2025, the main criteria include:

• Citizenship or Residency: You must be an Australian citizen or permanent resident aged 18 or over.
• First-Home Buyer Status: You must not have previously owned or had an interest in a property in Australia.
• Deposit: You need a minimum deposit of 5% (but less than 20%).
• Income Limits: Single applicants can earn up to $125,000 per year; couples up to $200,000 combined (as per ATO assessments).
• Property Price Caps: In Victoria, the property must not exceed the scheme’s regional or metro price thresholds — for example, $900,000 in Melbourne and $750,000 in many regional areas (subject to updates).
• Owner-Occupier: You must live in the property — it can’t be an investment purchase.

Sounds simple enough, right? But the application process can get tricky. That’s where your mortgage broker steps in.

How the Scheme Works

Each financial year, the government allocates a set number of spots (typically 35,000 nationally) for the First Home Guarantee. Once those spots are filled, applicants have to wait until the next release — which means timing is crucial.

Through the scheme, you’ll apply for a home loan with a participating lender, and Housing Australia guarantees the difference between your deposit and the 20% threshold. Importantly, the guarantee isn’t cash you receive — it’s a promise from the government to the lender, reducing their risk and your costs.

That’s why having a broker who knows which lenders currently have scheme places available can make all the difference between getting approved and missing out.

The Role of a Mortgage Broker in the Process

Think of your mortgage broker as your personal guide through the First Home Guarantee maze. They understand the eligibility rules, know which lenders are participating, and handle the paperwork so you don’t have to navigate it alone.

Here’s what a good broker will do for you:

• Check your eligibility before you apply
• Find lenders currently offering FHG spots in Victoria
• Compare interest rates, fees, and loan products
• Prepare and submit your application
• Liaise directly with the lender and Housing Australia
• Help you access other grants (like the First Home Owner Grant and Stamp Duty concessions)

In short, they handle the complex stuff so you can focus on finding your dream home.

Benefits of Using a Mortgage Broker

Working with a broker isn’t just convenient — it can save you serious time, money, and stress. Here are the top benefits:

• Access to Multiple Lenders: Not all banks participate in the First Home Guarantee. Brokers know which ones do — and can match you to the right fit.
• Expert Guidance: The eligibility criteria can be confusing, especially around income and property caps. A broker ensures your application meets every requirement.
• Speed: Brokers often have direct relationships with lenders, meaning your application can move faster — a big advantage in a competitive market.
• Maximised Approval Chances: Brokers understand what lenders are looking for and can package your application for the best outcome.
• It’s Usually Free: In most cases, brokers are paid by the lender, not you — so you get professional support at no extra cost.

Documents You’ll Need to Apply

Your mortgage broker will help you gather everything you need for a smooth application. Typically, you’ll need:

• Proof of ID (passport or driver’s licence)
• Recent payslips and employment details
• Bank statements showing savings and expenses
• Tax returns (for the past two years)
• Evidence of your 5% deposit
• Property details (if you’ve already found a home)

Brokers make sure all documentation is complete and accurate — preventing delays or rejections caused by simple mistakes.

Which Lenders Offer the First Home Guarantee?

Only specific lenders are approved by Housing Australia to offer the First Home Guarantee. These include both major banks and smaller regional lenders.

Some of the main participating lenders include:

• Commonwealth Bank of Australia
• NAB (National Australia Bank)
• ING
• Bendigo Bank
• Australian Military Bank
• Regional Australia Bank
• Bank Australia
• Credit Union SA

The catch? Each lender only receives a limited allocation of FHG places — and they can run out quickly. Mortgage brokers monitor availability in real-time, ensuring your application goes to a lender who still has open spots.

Common Mistakes First-Home Buyers Make

Even with government help, many buyers make simple errors that slow down or jeopardise their application. Here are the most common pitfalls:

• Applying too late: Scheme places are limited, and once they’re gone, you have to wait until next year.
• Choosing the wrong lender: Not all lenders offer the FHG — applying with the wrong one wastes precious time.
• Not understanding income limits: Exceeding the cap by even a small amount can disqualify you.
• Incomplete documentation: Missing payslips or bank statements can delay approval.
• Overlooking property caps: Buying above the threshold makes you ineligible for the scheme.

Your mortgage broker ensures you avoid all of these mistakes by keeping your application on track from start to finish.

Example of How a Broker Can Help

Let’s say Sarah and Ben, a young couple from Geelong, found a home priced at $700,000. They’d saved $35,000 — a 5% deposit. They approached a mortgage broker to see if they could qualify for the First Home Guarantee.

The broker confirmed they met the eligibility criteria (combined income under $200,000, first-home buyers, Australian citizens) and checked lender allocations. Within a week, the broker submitted their application through a participating lender still offering FHG spots. The broker also helped them apply for the First Home Owner Grant and explained the stamp duty concessions available in Victoria.

Two months later, Sarah and Ben were holding the keys to their new home — and they didn’t have to pay a cent in LMI. Without their broker, they might have missed the timing or applied to a non-participating bank.

Why You Shouldn’t Go It Alone

Could you apply for the First Home Guarantee directly? Technically, yes. But here’s the catch — the scheme is complex, competitive, and full of fine print. Lenders have different turnaround times, and a small paperwork error could cost you a place in the program.

Mortgage brokers do this every day. They know the system inside out, keep up with changes, and have direct lines to lenders. For most first-home buyers, that expertise is priceless. Plus, their services are generally free, as they’re paid a commission by the lender once your loan is settled.

Final Thoughts — Partner with Lowest Interest Rates

Buying your first home in Victoria is exciting, but it’s easy to feel overwhelmed by the rules, paperwork, and government schemes. The First Home Guarantee is one of the best opportunities for new buyers to get a foot on the property ladder sooner — and a trusted mortgage broker can help make it happen.

Whether you’re still saving for your deposit or ready to apply, the team at Lowest Interest Rates can help you navigate the process, compare lenders, and secure your place in the scheme before it fills up. Their expert brokers work with leading banks and lenders across Victoria to find you the best rates, fastest approvals, and most suitable home loan solutions.

Visit LowestInterestRates.com.au today and take the first step toward buying your dream home in Victoria — with confidence, clarity, and expert support every step of the way.