FHLDS Question

Discussion in 'Loans & Mortgage Brokers' started by Fred_11, 11th Jan, 2020.

Join Australia's most dynamic and respected property investment community
Tags:
  1. Fred_11

    Fred_11 Member

    Joined:
    11th Jan, 2020
    Posts:
    6
    Location:
    Perth
    Hi All.
    I only just today found out about the FHLDS on TV where they said the initial allocation had been exhausted (I dont watch a lot of tv). From further reading I believe it's 3,000 allocations from CBA & NAB that have been exhausted?

    Using the online eligibility tool, it looks like we are eligible for the scheme.

    My partner & I have been saving for approximately 9 months. We've got around $30k savings and are looking to buy something established around the $400k mark in Perth.
    We actually saw a mortgage broker in November but the broker never mentioned anything about the scheme, or even the SHSSS. Naturally I am disappointed to have missed out on the initial allocation.

    I was hoping people might have some advise on how to maximise our chances of a successful application when the remaining spots open up to the smaller banks in Feb?
    - I feel like I've lost confidence in the advise from my broker because I would have thought that he should have known about the scheme in November, or at least in recent discussions (early Jan). I'm also concerned he may not have commission agreements with a lot of the smaller banks & thereby limiting our chances if we continue with him?

    I know very little about the application process & would love to hear from people who have accessed the scheme already.

    Any information which may help us in securing an allocation in Feb would be greatly appreciated. :-D
     
  2. Morgs

    Morgs Well-Known Member Business Member

    Joined:
    7th Dec, 2017
    Posts:
    704
    Location:
    Sydney NSW
    We had planned for months with our FHBs to get things ready and had reserved spots on the first day the scheme opened (2nd Jan).

    CBA was the only lender that brokers had access to for the initial January allocation (which was a bit of a surprise). I know not all brokers have CBA on their panel, so might explain why it wasn't mentioned by your broker?

    The process around how to apply through CBA was only released on new year's eve. I've not heard anything from any of the other lenders around how the process will work with them either but I would suggest you need to get everything ready in preparation for the end of month so you can move quickly when the details are revealed.

    If it is anything like the CBA process, you will need to reserve a spot ASAP come 1st Feb, then within 10 business days have an application with the lender pre-approved, then you have 90 days to find a suitable home and have it formally approved.
     
    jembuss likes this.
  3. jembuss

    jembuss Active Member

    Joined:
    9th Dec, 2019
    Posts:
    39
    Location:
    seven hills
    Hey mate

    There is a list of the smaller lenders on the NHFIC website, im sure there is a host of great brokers on here they might deal with them.. if not research & find which one suits your needs best and deal with them directly, Set up your application with them now and send them all required documents so they can lodge for your reservation ID first thing on the 1st February and you shouldnt have an issue.

    Goodluck!
     
    Last edited: 11th Jan, 2020
  4. Maximus

    Maximus Well-Known Member

    Joined:
    4th Aug, 2019
    Posts:
    48
    Location:
    Sydney
    I didnt realise you could actually reserve a spot, there wasnt much details released prior to the commencement of the scheme. I dont actually need the scheme but it would allow me to keep a healthy buffer.
     
  5. Fred_11

    Fred_11 Member

    Joined:
    11th Jan, 2020
    Posts:
    6
    Location:
    Perth
    Thanks a lot for the replies. :)

    I guess what I'm wondering is, do I have to put all my eggs in one basket? By that I mean, if I hypothetically reserve a spot with bendigo, I'm essentially excluding all other banks & if my application with bendigo is eventually rejected, I'll likely have missed out on spots with other banks. Or is the suggestion to get pre-approved now ahead of Feb1 by multiple banks so we have a better chance of snaring an allocation when they open?

    I just rang NAB, and the person answering my call advised that they have exhausted their initial allocation, but are expecting more spots to open up next month. He explained that we could go on a wait list of sorts, and they would contact us if/when the spots open up. I guess there isn't really anything to lose by doing this?
     
  6. Morgs

    Morgs Well-Known Member Business Member

    Joined:
    7th Dec, 2017
    Posts:
    704
    Location:
    Sydney NSW
    Lodging multiple applications with multiple lenders wouldn't make it any quicker and create a heap of work and damage your credit file. I'd suggest go with the lender that is the best fit and deal for your individual circumstances. With CBA the pre-approval requirements/structure was different to a normal application and it needed to be submitted post the FHLDS spot being reserved.
     
  7. Fred_11

    Fred_11 Member

    Joined:
    11th Jan, 2020
    Posts:
    6
    Location:
    Perth
    Thanks again.
    I feel like we cant afford to be too fussy. The only workable options for us at the moment is to utilise the SHSSS scheme, the FHLDS, or build (FHOG). We dont want to build due to that meaning we'll have to move far from the CBD which we dont want. Naturally that leaves the other two & I'd rather not dip into our super if possible.

    I presume the best option then is go on as many 'wait lists' as possible?

    The NAB guy advised that we could go on their list, but of course I dont know if we are 10,000th on their list with only 1,000 spots opening up on Feb? He seemed quite in the dark also - but I dont know if it's intentional (they're possibly keen to keep collecting customer information even if there's no chance of them securing a spot in the FHLDS?)
     
  8. Morgs

    Morgs Well-Known Member Business Member

    Joined:
    7th Dec, 2017
    Posts:
    704
    Location:
    Sydney NSW
    I suppose you could try to do that... or see a broker who knows what they're doing so they can do a proper assessment, identify an appropriate finance solution, and get you prepared so that when the February intake goes live you have someone there looking after your file. You may not have that same level of accountability if you're only on a list.
     
  9. Fred_11

    Fred_11 Member

    Joined:
    11th Jan, 2020
    Posts:
    6
    Location:
    Perth

    Very true. After not being advised of the FHLDS or the SHSSS by my current broker, I am a little unsure now. I dont know what his motivations were behind not advising us, or if it was an error?
    Am I being too critical to think that my broker should have advised us of these schemes when we met in November? I had no clue these schemes existed, but surely there was knowledge about them in the industry?

    And assuming he should have known and advised us, how do I now go about finding another broker that does have our interests at heart? (and is competent)
     
  10. Morgs

    Morgs Well-Known Member Business Member

    Joined:
    7th Dec, 2017
    Posts:
    704
    Location:
    Sydney NSW
    I can't speak for your broker.. but there are plenty of us here on PropertyChat so whoever you talk to will be able to look after you :)
     
  11. Lindsay_W

    Lindsay_W Well-Known Member

    Joined:
    1st Jul, 2015
    Posts:
    915
    Location:
    QLD
    @Morgs do you happen to know what happens to the allocations that don't end up being used?
    eg say you registered a FHB for one with CBA, they don't end up buying anything, does that allocation go back to CBA or the next name in line?
    There's the potential for this to get a bit messy in a few months time.

    I noticed CBA's registration requirements are more in depth than the small lenders, some of the smaller lenders only require name, email and phone number, that's it :confused:
     
  12. Morgs

    Morgs Well-Known Member Business Member

    Joined:
    7th Dec, 2017
    Posts:
    704
    Location:
    Sydney NSW
    Yeah, it sure is a mess!

    I did speak to CBA around this. They've have completed their allocation for January (obviously) and advised they've effectively got a waiting list of applicants that they're working through for when those allocated spots fall off. Apparently a fair few reservations are falling over at AIP stage because they're finding lots of the applications don't meet policy so those spots are being reallocated.

    The second stage will be those who have AIP approved and a reservation and fail to find a property to go unconditional within 90 days & fail to lodge an extension, and given the nature of the FHB segment I'd also expect lots of spots to come up this way.

    Don't think things will be too much more straightforward for February unfortunately!
     
    Lindsay_W likes this.
  13. Maximus

    Maximus Well-Known Member

    Joined:
    4th Aug, 2019
    Posts:
    48
    Location:
    Sydney
    I applied and am on the "waitlist" i dont really think i will be buying in the next few months as i dont see much good stock in need of reno coming up, mostly already done cheap/quick renoed stuff for the unsuspecting.

    I figure i will wait till the spots already allocated have been used so there are potentially no more first home buyer spots left in the brief period between may-june (prior to july release).
    I can hopefully find something at that time with less competion, this also helps me continue saving while finding other employment.
     
  14. jembuss

    jembuss Active Member

    Joined:
    9th Dec, 2019
    Posts:
    39
    Location:
    seven hills
    Hey mate any insight on lodging for a extension of the 90 day period and how it works?

    Cheers
     
  15. Morgs

    Morgs Well-Known Member Business Member

    Joined:
    7th Dec, 2017
    Posts:
    704
    Location:
    Sydney NSW
    Depends on the lender on their process, but if it is anything like CBA they have a template you need to complete and send to them before 85 days have elapsed. That'll extend it for another 30 days, unclear at this stage if you can keep extending it or if it is a one off.
     
  16. jembuss

    jembuss Active Member

    Joined:
    9th Dec, 2019
    Posts:
    39
    Location:
    seven hills
    Cheers mate appreciate it
     
  17. Lindsay_W

    Lindsay_W Well-Known Member

    Joined:
    1st Jul, 2015
    Posts:
    915
    Location:
    QLD
    Thanks mate, this could mean that some FHB's who register and don't get an allocation prior to buying, could then get an allocation AFTER they've purchased, messy indeed.
     
  18. Fred_11

    Fred_11 Member

    Joined:
    11th Jan, 2020
    Posts:
    6
    Location:
    Perth
    What are people's thoughts on applying with multiple banks?
    Our broker has prepared an application with P&N, but I dont know if I'm limiting my chances by not applying with other institutions?
    - It is my understanding that all of the smaller lenders draw from the same pool of 5000 applications, but obviously they will do so at different times.
    I'm SO confused about what to do... ;'(
     
    Lindsay_W likes this.
  19. jembuss

    jembuss Active Member

    Joined:
    9th Dec, 2019
    Posts:
    39
    Location:
    seven hills
    In my opinion it wouldnt hurt, a lot of banks & brokers are useless ( not all ) and wont get back to you or proccess things in a timely manner as your situation is time sensitive i wouldnt leave it in one banks hands, i would apply at multiple and act on who ever gets back to you promptly.

    Im sure someone will state if this is not advised, however i did with success.
     
  20. Lindsay_W

    Lindsay_W Well-Known Member

    Joined:
    1st Jul, 2015
    Posts:
    915
    Location:
    QLD
    I would go back to your broker and ask the question because there's no point applying with a lender that you fail serviceability with. You may get an allocation and then find you can't get a loan via that lender.