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First home buyers left in the dark over ‘rushed’ home loan scheme
The government’s attempt to help struggling first home buyers get into the housing market has fallen flat, with first home buyers being left in the dark, according to a mortgage broker.
First home buyers left in the dark over ‘rushed’ home loan scheme
The government’s attempt to help struggling first home buyers get into the housing market has fallen flat, with first home buyers being left in the dark, according to a mortgage broker.
Louisa Sanghera, Zippy Financial’s director and principal broker, believes that the government’s policy, which comes into effect next year, has been “rushed” and is filled with problems.
“The scheme was first announced during the election, but it seems the policy is only now being developed when it is due to start on 1 January,” Ms Sanghera said.
“It does seem like the policy has been rushed and not been properly thought through.
“With less than two weeks before it starts, first home buyers are mostly in the dark about how the scheme will even work.”
Ms Sanghera noted that even mortgage brokers were struggling to understand the finer details of the scheme, including why such a small number of lenders were taking part.
Of note, she said, is the fact that the National Housing Finance and Investment Corporation only recently released the list of lenders involved in the first round of the scheme, with only 27 participating, including just two major banks.
“By restricting the scheme to 27 banks, they are reducing competition, which will potentially mean higher interest rates for the type of buyers who are struggling with housing affordability the most,” Ms Sanghera said.
“The selection of lenders has also not been transparent, because I can’t find any information on which banks applied to be a part of this scheme, who was declined or why.”
Ms Sanghera said some of the regional lenders given access to the scheme would be of no help to first home buyers who lived in Sydney and Melbourne, which reduces choice even further.
“Many of the lenders are also not available on mortgage broker’s panels, even though brokers write about 65 per cent of mortgages in Australia, so we have no access to them,” she said.
“How can restricted access to all banks be a good outcome for everyday Australians trying to get into the housing market? How has ASIC even approved this scheme?”
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