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First Home Finance

First Home Finance


 First Home Finance was developed by the Department of Human Settlements to enable sustainable and affordable first-time homeownership opportunities to South African citizens and legal permanent residents earning between R3,501 and R22,000 per month, (the ‘affordable’ or ‘gap’ market).

Individuals in these salary bands generally find it hard to qualify for housing finance; their income is regarded as low for mortgage finance, but too high to qualify for the government free-basic house.


What to do with First Home Finance Qualifying applicants can: A Buy an existing, new, or old residential property B Buy a vacant serviced residential stand, linked to an NHBRC registered homebuilder contract; C Build a home on a self-owned serviced residential stand, or tribal stand (PTO) through an NHBRC registered homebuilder.

The once-off First Home Finance amount ranges between R30,001 and R130,505, depending on the applicant’s monthly income.



Applicants intending to acquire residential property may apply for First Home Finance if they meet the following qualifying criteria: –

 South African citizen with a valid ID; or permanent residents with a valid permit; Over 18 years and competent to legally contract.

Have never benefited from a Government Housing Subsidy Scheme before.

Have an Approval in Principle of home loan from an accredited South African financial institution; and First time home buyer, earning from R3,501 to R22,000 per month.


 Requirements The following CERTIFIED COPIES are required as supporting documents when applying for First Home Finance:

 RSA bar-coded Identity Document (ID) Bar-coded Permanent Residence Permit (where applicable) Birth Certificates/RSA ID’s of all financial dependents (where applicable)

 Proof of Foster Children Guardianship (where applicable)

Marriage Certificate, Civil Union Certificate or Cohabiting Affidavit, Proof of Partnership (where applicable)

 Divorce Settlement (where applicable) § Spouse’s Death Certificate (where applicable)

Proof of Monthly Income § Home Loan Approval in Principle/Grant letter from an accredited Lender  Agreement of sale for the residential property § Building Contract and Approved Building Plan (where applicable)

Accessing First Home Finance REDUCES AUGMENTS Property Price Approved Home Loan Less FHF as a deposit Eventual Home Loan Amount First Home Finance REDUCES the initial home loan amount, making monthly loan repayment instalments affordable (payment made to home loan account)

SUBSIDY QUANTUM Example 1 is based on a R9 000 p/m income – band, where the individual after the Lender/Bank’s credit and affordability assessment, based on the National Credit Act (NCA) criteria, qualified for R300,000 home loan. R300,000 R300,000 R93,526 R206,474 Property Price Approved Home Loan Less FHF as a HL TOP UP Eventual Home Loan Amount R300,000 R300,000 R93,526 R206,474 First Home Finance AUGMENTS shortfall between the qualifying loan amount and the total product price (payment made to transfer attorneys)

SUBSIDY QUANTUM Example 2 is based on a R9 000 p/m income-band, where the individual after the Lender/Bank’s credit and affordability assessment, based on the National Credit Act (NCA). Upon the lender granting of the home loan, the developer, banks, and estate agents.