🏡 Case Study: Housing Guarantee Scheme (HGS) vs Non-HGS – Which First Home Buyer Path Is Right for You?
At Best Foot Forward Mortgage Solutions, we understand that no two home buyers are alike. That’s why we take a tailored approach—especially when it comes to helping first home buyers decide whether to apply under the Housing Guarantee Scheme (HGS) or go with a non-HGS lender.
To help you understand the real-world impact of each option, here are two recent case studies from our clients—both first home buyers, both with strong applications, but each with a different lending path.
🔹 Case Study 1: First Home Buyer (Non-HGS)
Client Snapshot:
New Permanent Resident from Vietnam, VISA S1/189.
Single applicant, income: $94,000 p.a.
Large deposit, borrowing $400,000 at 53% LVR
Purchase Price: $750,000
Buying their first home in Victoria
Did not apply for the HGS
Our Strategy:
Collected and submitted comprehensive documentation:
Income and identity verification, VEVO (VISA Check)
3 months of bank statements
Financial Passport, by Open Banking for expenses analysis
Credit report and broker notes
We decided to hedge our bets and choose two lenders:
One for fast pre-approval (within 40 minutes!) so the client could attend an auction
Another offering a cheaper interest rate as a backup
The Outcome:
Interest rate secured: 5.39%
Features: With Offset Account, any spare funds can be used as a buffer and to reduce the loan's lifetime.
Loan amount: $400,000
Deposit: $400,000 (approx. 50%)
Bonus: May be eligible for the Victorian First Home Owner Grant ($10,000)
The client is now actively searching for the right property
✅ Why this worked:
No HGS meant greater lender flexibility
Faster turnaround times with fewer conditions
Potentially higher borrowing capacity
No second application step required
🟩 Case Study 2: First Home Buyers Using the Housing Guarantee Scheme (HGS)
Client Snapshot:
Couple:
Client A: Australian citizen
Client B: Permanent resident, originally from Vietnam, VISA Partner 801
Combined income $150,000
5% deposit with substantial savings and rental history
Looking to buy for $700,000 in Melbourne suburbs
Challenges:
Client B had recently changed industries (8 months in current role)
Limited to HGS lenders who accepted 2 payslips only
Couldn’t use the cheapest lender due to documentation restrictions
Our Strategy:
Submitted:
3-month savings history
Rental receipts (6 months)
Employment contracts
x2 Pay slips and Notice of Assessments from 2024.
Pre-approval granted within 2 hours, subject to:
HGS spot allocation
Property valuation.
The Outcome:
Clients Purchased a $690,000 Property
Valuation: Received within 40 minutes of requesting a valuation, and matched the Contract of Sale Price.
Interest rate secured: 5.74% (with negotiated discount)
Loan Features: Offset Account, any spare funds can be used as a buffer and to reduce the loan's lifetime.
Pre-approval secured in time to purchase before the end of the financial year
Clients were approved for:
The Housing Guarantee Scheme (no LMI!)
Victorian First Home Owner Grant ($10,000) – paid after settlement
✅ Why this worked:
Able to buy with only a 5% deposit
Saved thousands in Lenders Mortgage Insurance (LMI)
The government guarantee brought LVR to 80%, which then meant the clients secured a competitive interest rate of 5.74%
Utilising the HGS is a great solution for clients with less upfront capital but stable income
🔍 Key Differences Between HGS and Non-HGS Lending
FHOG - Every state has its own rules and criteria. To learn more, visit our page on FHOG
✨ Final Thoughts: Which Path Is Right for You?
Whether you’re a single applicant with a large deposit or a couple working with a smaller deposit, both pathways—HGS and Non-HGS—offer distinct advantages. The key is knowing which lenders are the right fit for your profile, and that’s where we step in.
At Best Foot Forward, we tailor our approach to your situation and goals, whether you're eligible for the Housing Guarantee Scheme or better suited to a traditional lender.
📅 Want to discuss your options or get pre-approved?
Book a consultation with us today—we’ll help you take your best step forward.
The information contained is general information only and does not consider your objectives, financial situation and needs. Not all lenders have the capacity to approve loans in under two hours. Please talk to us if you need a fast-tracked home loan, and we can help you find a lender that has the processes in place to process the application quickly. We strongly recommend that you do not act on any information provided on this website without individual advice from your trusted advisor. You should also obtain a copy of and consider the Product Disclosure Statement for all financial products before making any decision.
Best Foot Forward always tries to make sure all information is accurate. However, when reading our website, please always consider our Disclaimer policy.
