29KPrinciples for the operation of the Home Guarantee Scheme

29K Principles for the operation of the Home Guarantee Scheme

(1) Housing Australia must operate the Home Guarantee Scheme in a manner that seeks to: (a) maximise the integrity of the Home Guarantee Scheme; and (aa) ensure that a proportion of guarantees issued under the First Home Guarantee in the 2022-23 financial year or a later financial year are issued to eligible lenders that are not major banks; and (b) subject to subsection (3), prevent residential properties from being used other than as owner-occupied residences; and (c) encourage and incentivise borrowers to repay loans as soon as possible; and (d) ensure that eligible home buyers, eligible single parents and eligible single legal guardians have used the maximum amount of their savings as a deposit, subject to the credit policies of their eligible lenders; and (e) minimise the quantum of payouts under guarantees issued under the Home Guarantee Scheme, in accordance with industry best practice (including practices applied to loans with parental guarantees); and (f) monitor the status of guaranteed loans to identify when there is a significant likelihood of a borrower defaulting on their obligations under a loan; and (g) minimise the cost of guaranteed loans to borrowers. (2) Subsection (1) does not limit the powers of Housing Australia to administer the Home Guarantee Scheme in a responsible and commercial manner, consistently with the requirements of this Part. (3) Despite paragraph (1)(b), Housing Australia must not seek to prevent a particular residential property from being used other than as an owner-occupied residence where: (a) a loan that was guaranteed under the Home Guarantee Scheme was used to purchase the property; and (b) after the time the loan agreement was entered into, the property had been used as an owner-occupied residence; and (c) the owner-occupier, or one of the owner-occupiers: (i) has, after having been employed by the same employer for at least 12 months, been required, by that employer, to relocate; or (ii) suffers from an illness that Housing Australia considers to be serious; or (iii) has carer responsibilities for a person who suffers from such an illness; and (d) as a result, Housing Australia is satisfied that it is impracticable for the property to continue to be used as an owner-occupied residence.