First Home Savers Account

Kevan2 on 20/04/2014 - 15:50

As started in https://www.ozbargain.com.au/node/140400.

Some help with understanding how this works would be appreciated.

I have passed the opportunity for this - https://www.moneysmart.gov.au/managing-your-money/banking/sa…

Having a play with the calculator there are some opportunities. https://www.moneysmart.gov.au/tools-and-resources/calculator…

for those who have not purchased their home.

  1. the elder community have to take funds out at 65, or put into super from 60. If you like almost guaranteed rate and do not wish to own a home - footloose and fancy free.

  2. If you are/ Or are likely to become ill and meet super terms of release TPD. you have the funds via super.

  3. Partners joint savings separate accounts. Get the grant twice , and one for now and one for next time,or on parting a little easier to say who owns what.

Bad parts, 4 years minimum time or in super, no cash funds.

My Question
Does any one know if the account can be part of Home loan security if you have not the 4 years minimum?

If you qualify and can find $6K a year $1020 from government and interest earned no fees seems a too good deal.

Budget Attack

I assume Grandfather arrangements will apply if the offer is withdrawn.

If changed ie lower payment from government —- any one has a view.

Financial

Related Stores

moneysmart.gov.au
moneysmart.gov.au

Comments

  • 2pro4sho on 20/04/2014 - 18:30

    I'm not sure what your question/s are? You can't touch the money until a min of 1k deposit is made for 4 years otherwise you can put it into your super.

  • bodacious on 20/04/2014 - 20:49

    I'm planning to take the plunge with this this year. As I figure the funds won't be missed and the rebate is very good.

    I can't answer your question about using fund before the 4 years, but I know from looking into this deal that the 4 year wait to spend it on a home is actually only 2 years and 2 days if u sign up on the 30th June, as it is only 4 financial years that you must wait, so 2 years 2 days is the minimum before having access for 1st home buying.

    I will defianntly be laying down my $6k on or before June 30.

  • grasstown on 20/04/2014 - 22:36
    +1

    I doubt it can be used as security. Although if you were 6 months out from releasing it, I imagine that some lenders might allow it to be. On their discretion. Presumably banks would want security to be available immediately if they became entitled to it.

  • YTW on 20/04/2014 - 22:53
    +1

    I think one of the most important conditions for consideration is this:

    If you buy your first home before the 4 year period is up, you can withdraw the money in your account at the end of the 4 year period to put towards your mortgage. You will not be able to make any more deposits once you have built or bought a property.

    Brilliant condition - means you are not restricted at all as to when you actually buy the home, provided you aren't dependent on the cash within the account for the deposit. Which leads me to the next point…you'd really only want to put in the minimum amount you need to qualify for the maximum government co-contribution and the rest of your savings elsewhere so that if you do find a house before your 4 financial years (not full years, if you time it well) you can use the funds saved elsewhere as a deposit and then once the wait is up on the funds in this account you can just pay them straight off the mortgage. You'd also want to make sure that you have made all of your eligible contributions for the financial year before you sign any purchase contracts.

  • Kevan2 on 23/04/2014 - 20:58

    Thanks, the snake in the wood pile is the up and coming budget.

    Is there a real chance of the government changing or withdrawing the generous offering?
    It has happened so often in the superannuation field. Does not matter which party was in.

    And yes, it was a long bow to expect that the lending bank would take a mortgage over the home savers account even though they would have some control. The superannuation choice would proberly put pay to any other choice, such as keep to acquire home after 4 year, use after four years or drop it into super. Looks like you don't use this if you buy/build too early and could be short and have to pay mortgage insurance.

    Mortgage insurance good to get a home, BAD BAD and BAD if home is sold by the lender.

  • SaberX on 04/05/2014 - 14:57

    YTW is correct - basically the new rules are great: you can use the funds after your 4 years are met even if you buy a house in the meantime ( just make sure it meets the relevant criteria so that after the 4 years it can still be used).

    So basically it can only be used as your consideration for deposit if it's after the 4 years minimum.

    It's not too good a deal to be true - it really is true. Put in $6k, get 17% govt co-contribution of $1,020, plus interest on these amounts.

  • Kevan2 on 18/05/2014 - 22:04

    As expected. Goodluck to those who got in early enough.
    3.8 First Home Saver Accounts abolished

    Effective Date: various from 13 May 2014

    The Government intends to abolish the First Home Saver Accounts (FHSAs) scheme due to lower than expected take-up rates.

     New accounts opened after 13 May 2014 will not be eligible for concessions

     Existing account holders will continue to receive the Government co-contribution and all tax and social security concessions associated with these accounts for the 2013-14 income year

    From 1 July 2015, FHSAs will be treated like any other account held with the provider and account holders will be able to withdraw their balance without restriction

    • grasstown on 18/05/2014 - 22:25

      I just realized you predicted it in April pre budget. Well done. I had no idea it was on the radar

    • drbargain on 24/05/2014 - 11:41

      So if I have one of these accounts open that I haven't used I can deposit $6K before June 30 this year collect the bonus and withdraw after July 1 2015 without restriction?

  • Gomo on 03/06/2014 - 20:20
    +1

    Wow.. I'm glad I got in when this was active :)

    Was great to put money aside 4years ago! the bonus contribution from the govt of 17% was awesome! now I'm in my lovely new home just 4 months ago :)

Login or Join to leave a comment
Login Join