The government has recently made amendments to the First Home Savers Account (FHSA).
In the past, early purchasers would see their FHSA balance forced into superannuation.
However, under the recent rule changes, FHSA money can be put into an account holder’s mortgage, if they buy a first home earlier than existing rules allow. While the funds will not be immediately available for use towards a deposit, the account can remain open (with no further contributions allowed after settlement) and after meeting the 4 year minimum qualifying period the money will be available to pay down the first home buyer’s mortgage.
This is a signicant improvement will increase the flexibility of of the FHSA and will mean that first home owners will not be forced to wait until they are 60 before finally having access to this saving.
It should be noted that this change in rule is not retrospective, so it will not help those home owners who have bought their first home within the four year window before this change in rules came into force.
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