Important things to keep in mind when applying for FHSS – First Home Super Saver NSW.

If you’re a home buyer for the first time, you may qualify for first home super saver NSW. It is government assistance amounting to $15,000 grant for new homes as long as the purchase price does not exceed $650,000. You can also apply for a $7000 Regional Relocation Grant if your new location is in the regional area, provided that you have relocated from a metropolitan area.

What qualifies as a new home? 

  • It was not previously occupied – If you rented it out to someone or another occupant stayed there before you did, then it will no longer be considered as a new home. Even the builder cannot stay there. So, to be careful about it. Make sure that when you buy a house, you don’t allow anyone to stay there yet if you intend to avail of the FHSS. Otherwise, your application can be rejected.
  • It was not previously sold by its owner under the category of ‘residential property” – if you bought it as a residence, you cannot apply for the scheme anymore. Just make sure that you bought the property as is, and perhaps improved it or converted it into a residential area.  One of the purposes of the law is to encourage first time home owners to build or have their own homes.
    • But, there is an exception. If you bought a home and substantially renovated it—meaning, it no longer has the feature of the old home, but can be mistaken for a completely new house, you can apply for a loan. The same rule applies to homes that have been built on demolished areas.

What do you mean by substantial renovations?

A substantially renovated home is defined by law as a home, which was renovated, and has not been used or sold as a place of residence. So, even if you bought a building with the features and amenities of a residential area, but no one occupied it and the contract of sale does not state that it is a residential property.

If all areas of the building have been replaced, The GST Act considers the replacement as a substantial renovation. The same implication applies to a building wherein all the major areas are replaced or removed.  A substantially renovated building is one which looks new and does contain new areas or essential parts of a house which was not previously present in the old structure.

Here are tips to increase the chances of approval for FHSS:

  1. Submit a completely and accurately filled up application form with relevant supporting documents.

Take note that only Australian citizens and permanent residents qualify for this scheme. So, for natural born Australian, simply prepare your Australian Birth Certificate. Passports and birth extracts will not be accepted.

Permanent residents need to provide their foreign passport. You also need to prepare your current Australian Visa together with your citizenship certificate andƒ foreign passport. Be ready to provide explanations for incomplete documents.

There are additional documentary requirements for people with special situations. For example, if you have applied for a change of name and were granted favorably by the court, the commission will require you to present evidence of your change of name. It is a critical requirement especially to those applicants who present documents with a name which is different from the name you are currently using, or vice versa. Married applicants have to provide a copy of their marriage certificate, and those who went through a divorce also need to show their decree nisi or divorce certificate.

  1. Be careful with property specifications and dates of purchase.

First and foremost, it must not be occupied previously as a place of residence, not even by your close relative or even the laborers working on your home. It is also important to look at the date of the commencement of contracts.

If you bought the property from October 1, 2012 to June 30, 2014, check if the value of the property is $650,000 or less. The FHSS cap is only limited to that amount. If it exceeds by a dollar you cannot apply for the scheme. The purchase price must not exceed $750,000 if you bought the property on or after July 1, 2014.

  1. Remember that you may have to pay up to 100% of the scheme if you apply for the loan even when you are not eligible to do so.

It is illegal for any person to provide false or misleading statements in the FHSS application. So, always provide accurate information in the application, and if you have questions, contact the proper authorities for clarification.  Those whose applications have been approved and consequently received the scheme must satisfy all conditions in the scheme, especially the residence requirement.

It is also important to submit all the necessary documents within the time frame set by the commission; otherwise, you may have to pay back the 100% grant. Those who are not able to meet their obligations are subject to penalties imposed by The Act.

Contact us today to learn more about first home super saver NSW and the loan options if you do not qualify for the scheme.