» Minimum Eligibility Requirements
» Length of Entitlement
» Accessing DHOAS Assistance
» Subsidy Certificate
» DHOAS Home Loans
» Subsidy Tiers and Payments
» From DHOS/DSH to DHOAS
» DHOS-Entitled Extenuating Circumstances
» Conditions
» Exemption from Effective Service Requirement

Eligibility Requirements

To be eligible for DHOAS, and to start receiving DHOAS subsidy payments, you need to meet the following requirements:

  • Have served in the ADF on or after 1 July 2008. 
  • Complete a qualifying period. 
  • Accrue entitlement to DHOAS, known as a Service Credit. 
  • Meet the conditions of the Scheme.    

Permanent Members

If you're a Permanent member you will complete your DHOAS qualifying period after four consecutive years of service, and gain a minimum Service Credit after one month of service.

Permanent members accrue entitlement monthly. You will gain one month of entitlement to DHOAS for every month of service completed after the qualifying period, or one year of entitlement for every full (calendar) year of service. This is up to a maximum of 20 years, or up to 25 years if you've completed warlike service.

Reserve Members

If you're a Reserve member you will complete your DHOAS qualifying period after eight consecutive years of effective service. An "effective" year of service for Reservists is at least 20 days of service completed within the financial year.

Reservists accrue entitlement per financial year. After the qualifying period, you will need to complete at least 20 days of service within a financial year to gain a minimum Service Credit.

This will give you one year of entitlement to DHOAS. From then on, like Permanent members, you will accrue one year of entitlement to DHOAS for every (financial) year of service you complete thereafter (up to a maximum of 20 years, or up 25 years if you've completed war-like service).

As a Reservist you can fast-track your qualifying period if you complete more than six months of Continuous Full-Time Service within the financial year. You will gain two years towards your eight year qualifying period. This CFTS allowance does not apply once you have completed your qualifying period.

Impacts on Eligibility

As either a Permanent member or Reservist, if you take a break from the ADF before you complete the qualifying period you will need to restart the qualifying period from when you re-enlist.

There is a range of variables that can impact on DHOAS eligibility for both Permanent and Reserve members. They include lateral service, transferring between the Permanent ADF and the Reserves, taking a break in service, rejoining and separating from the ADF.

You are advised to review details about any variables that may impact on your eligibility (see "Eligibility and Entitlements").

Check Your Service Records

You should check your PMKeyS records to ensure that they're up-to-date and include all of your service in the ADF, in either the Permanent Forces or the Reservists, as well as any war-like service you have completed.

If your records include any errors or omissions you should raise the matter with your chain-of-command.

If your records are out-of-date and we check your DHOAS eligibility or entitlement against them when it is time to progress your subsidy payments or to determine your Service Credit, this may result in a miscalculation. This could result in a drop to your subsidy tier level or even your payments being ceased.  

Effective Reserve Service and Inadvertent Separation

If you are a Reservist and you do not complete effective Reserve service within a financial year you will be deemed to be separated for the purpose of DHOAS. This separated status can significantly impact on your DHOAS eligibility and entitlement.

"Effective" Reserve service is defined as at least 20 days of active Reserve service within a financial year.

For the purpose of DHOAS, this requirement to complete at least 20 days of active service to not to be deemed to be separated applies to all Reservists, whether you are in the Standby, High Readiness or any other Reserve-type service.   

Potential impacts include: 

  • If you do not complete a year of effective service during your DHOAS qualifying period, you will break the required continuity of service and you will need to restart your qualifying period from the date you are deemed to be a member again.
  • If you have finished your qualifying period and you are currently accessing DHOAS, ineffective service which results in you being deemed separated from the ADF could impact on your entitlement. If you have not completed 20 years of service as at the time you separate, you will receive your subsidy payments at the Tier 1 level (regardless of your tier level before separating). Please refer to Separation for further details.
  • If you have a break in service and then you rejoin the ADF (even if inadvertently), you could be subject to DHOAS rejoining provisions which can reduce or even cancel your DHOAS eligibility and entitlement. For further details, see Rejoining the ADF After a Break.  

Alert: Reassessments under Amended DHOAS Act

The DHOAS Act was amended last year, effective from 22 July 2009. Before the Act was changed, members who had a break in service then rejoined the ADF as Reservists prior to 1 July 2008 were not subject to the rejoining provisions when their applications for DHOAS Subsidy Certificates were being assessed (whereas Reservists who rejoined after this date were). The amended Act closed this discrepancy.

If you are one of these members and you are currently receiving a DHOAS subsidy, if you change the status of your DHOAS assistance and you need to reapply to DVA for a Subsidy Certificate, be aware that your entitlement will become subject to reassessment under the amended Act. If you previously benefited from the rejoining provisions loophole, this reassessment could reduce or even cancel your entitlement.    

You may need to determine if it is better in your circumstance to continue receiving your current DHOAS subsidy (on your existing eligible DHOAS home loan) than it is to reapply, and possibly impact on your future entitlement.

You are advised to contact DHOAS before making any significant changes to your DHOAS subsidy arrangements.  

IMPORTANT NOTE

 

Your eligibility and entitlement to DHOAS can change significantly if your circumstances change. For example,  if you separate from the ADF; your one-off, post-separation Subsidy Certificate expires after 12 months; or you do not complete effective service as a Reservist.

 

If you sought information about DHOAS some time ago and were advised at that time you were eligible for DHOAS or had a certain level of entitlement, please do not assume this advice remains valid if your circumstances have changed.

 

You are urged to speak again with a DHOAS assistant or to re-check this website to ensure your understanding of your eligibility and entitlement remains correct.  

 

Go to Top

How long can I receive DHOAS assistance?

 

The length of time you can receive DHOAS subsidy payments will depend on the following:

  • Your years of effective ADF service and how much entitlement (known as a Service Credit) you have accrued.
  • If you have completed war-like service.
  • If you have previously accessed other Defence home loan subsidy schemes, DHOS or DSH.
  • If you have taken a break then rejoined the ADF, and you are subject to rejoining provisions.
  • Other factors, such as medical discharge or lateral recruitment from another country's Defence Force.
  • If you have reached the maximum entitlement to DHOAS, DHOS and/or DSH of up to 20 years without warlike service and up to 25 years with warlike service.

Service Credit

 

You can receive DHOAS subsidy payments (paid directly into a DHOAS home loan), either while serving or after you separate, for as long as you have a Service Credit and you meet all required conditions for accessing DHOAS. Once your Service Credit is expended your subsidy payments will cease, however much longer your DHOAS home loan repayments may continue.

 

You start accruing your DHOAS Service Credit after you complete your qualifying period (four consecutive years of service for Permanent members and eight consecutive years of effective service for Reservists). Your entitlement to DHOAS will continue to accrue while you serve in the ADF.

 

If you're a Permanent member you accrue your DHOAS entitlement monthly. For every month of ADF service you complete after your qualifying period you accrue one month of entitlement to DHOAS (or for every year of service you complete you accrue one year of DHOAS entitlement).  

 

If you're a Reservist you accrue a year of entitlement for every financial year of effective Reserve service you complete. "Effective service" means you must complete at least 20 days of Reserve service within the financial year.

 

** Reservists should be aware that you will not accrue a year of entitlement to DHOAS until you have actually completed the 20 days of Reserve service within the financial year. Therefore, if your current DHOAS Service Credit is expended before you can complete the required service to accrue further entitlement, your subsidy payments will cease. The subsidy will not be paid in advance of you completing the effective service, on the assumption that this will occur alter in the year. 

 

Please note that you don't have to wait until the end of the financial year to accrue the entitlement, if you complete the 20 days earlier in the year then you will be granted the additional DHOAS service credit at that date. For example, if your 20th day of Reserve service within the 2010-11 year is completed by 1 September 2010, you will accrue your one year of entitlement on 1 September 2010 (not 30 June 2011).

 

Overall, for both Permanent and Reserve members, to work out your Service Credit and the period of time you can receive the DHOAS subsidy, you add up:

  • total years of ADF service; plus
  • additional years gained from completing warlike service (see below).

Then you subtract...

  • your qualifying period;
  • any period of time you have already accessed DHOS or DSH, as well as DHOAS; 
  • breaks in service after finishing your qualifying period which have paused your accrual in entitlement; 
  • any years of ADF service that aren't recognised as a result of rejoining provisions.  

 

You can accrue a maximum, combined entitlement to DHOAS, DHOS and DSH of up to 20 years without warlike service or up to 25 years with warlike service. 

 

Whether you are able to access all of your accrued entitlement to DHOAS will depend on whether you continue to have an eligible DHOAS home loan into which your subsidy can be paid and on meeting the conditions of the Scheme.

 

Please note: A DHOAS Service Credit cannot be seen as a guarantee of benefits that will be paid to you for a certain length of time into the future, regardless of your circumstances. It is only indicative of how long you can receive DHOAS assistance as long as you meet the conditions. 

 

For example, you have a 10 year Service Credit but you close your DHOAS home loan after two years of subsidy. You cannot access the other eight years of entitlement unless you apply for another Subsidy Certificate, take out another DHOAS home loan and meet all other conditions. If you cannot do this then you cannot have a claim to a DHOAS entitlement.

 

Example of DHOAS entitlement period

 

You are a current member of the Permanent ADF, and you have completed 10 years and two months of effective service since you joined in 1998.

 

To work out your accrued entitlement, or Service Credit, you take your total period of effective ADF service (10 years, two months), then you subtract your qualifying period (four years). This means your Service Credit, as of today, is six years and two months. 

 

In addition, you have completed six months of warlike service. This means you can add an additional three years to your Service Credit, taking it up to nine years and two months.

 

However, you have already received the earlier home loan subsidy scheme DHOS for two years. You subtract this time no DHOS from your entitlement period.

 

This means, as of today you have seven years and two months of entitlement to DHOAS. You will also continue to accrue entitlement to DHOAS while you serve in the ADF.

 

In total, you can accrue a maximum, combined period of entitlement to DHOAS, DHOS and/or DSH of up to 20 years without warlike service and up to 25 years if you have completed warlike service.  

 

Warlike service and additional entitlement

 

If you complete warlike service you can extend the period of time that you receive DHOAS, up to a maximum of 25 years. You will be entitled to additional periods of subsidy assistance as set out in the following table:

Period of warlike service**

   Additional subsidy periods

Not more than 3 months

   2 years

More than 3 but not more than 6 months

   3 years

More than 6 but not more than 9 months

   4 years

More than 9 months

   5 years

 

 

** Any time spent on out-of-country leave during your warlike service does not count towards the warlike service bonus period.

 

Please note warlike service will not fast-track your qualifying period of four years. 

 

Nor will it fast-track you to a higher subsidy tier level. You still need to complete the minimum years of service required to be eligible for a higher subsidy tier.

Warlike service only increases the total period of time over which you may receive DHOAS assistance.

However, your additional accrued entitlement from warlike service is recognised for the purpose of converting your available service credit into a lump sum (up to a maximum of four years).  

Check your service records are updated

You should check your PMKeyS records to ensure that they're up-to-date and include all of your service in the ADF, in either the Permanent Forces or the Reservists, as well as any war-like service you have completed.

If your records include any errors or omissions you should raise the matter with your chain-of-command.

If your records are out-of-date and we check your DHOAS eligibility or entitlement against them when it is time to progress your subsidy payments or to determine your Service Credit, this may result in a miscalculation.

This could result in a drop to your subsidy tier level or even losing your eligibility and your payments being ceased.  

Previous Defence schemes and your DHOAS entitlement

The length of time you have accessed the Defence HomeOwner Scheme (DHOS) or Defence Service Homes Loans (DSHL) will impact on how long you can access DHOAS.

You need to subtract the period of time that you have received the DHOS or DSH benefits (and any DHOAS susbidy) from the length of your accrued DHOAS entitlement.

 

For example, you are a Permanent ADF member with 10 years service. You have six years of accrued entitlement to DHOAS (10 years minus four year qualifying period equals six years).

 

You have received DHOS benefits for four years. Take four years off your six years entitlement to DHOAS, and you are left with two years of accrued entitlement to DHOAS.

 

Your previous access to DHOS or DSH does not impact on your eligible subsidy tier or the amount of subsidy you receive, but on the length of time you can receive the DHOAS subsidy payments.

 

For example, if you've served for 10 years, you are eligible to receive Tier 2 benefits. These benefits apply even if your previous access to DHOS or DSH impacts on the length of time you can receive DHOAS.

 

Please note a member can accrue a maximum of 20 years entitlement to the DHOAS, DHOS and DSH combined, without completing warlike service, and up to 25 years with warlike service.

If you have accessed DHOS or DSH for 20 years (without warlike service) or 25 years (with warlike service), this means you will be unable to access DHOAS as you've already used your maximum entitlement to home loan subsidy assistance. This will apply even if you continue to serve in the ADF.

Impact of breaks in service on entitlement

Please note breaks in service may also impact on your DHOAS entitlement. Refer to Rejoining the ADF after a Break, or contact the DHOAS service centre for further information. 

Effective Reserve service and unintended separation

If you are a Reservist and you do not complete effective Reserve service within a financial year you will be deemed to be separated for the purpose of DHOAS. This separated status, even if unintended, can have a significant impact on your DHOAS entitlement.

"Effective" Reserve service is defined as at least 20 days of active Reserve service within a financial year.

For the purpose of DHOAS, this requirement to complete at least 20 days of active service to not to be deemed to be separated applies to all Reservists, whether you are in the Standby, High Readiness or any other Reserve-type service.   

Potential impacts include: 

  • If you do not complete a year of effective service during your DHOAS qualifying period, you will break the required continuity of service and you will need to restart your qualifying period from the date you are deemed to be a member again.
  • If you have finished your qualifying period and you are currently accessing DHOAS, ineffective service which results in you being deemed separated from the ADF could impact on your entitlement. If you have not completed 20 years of service as at the time you separate, you will receive your subsidy payments at the Tier 1 level (regardless of your tier level before separating). Please refer to Separation for further details.
  • If you have a break in service and then you rejoin the ADF (even if inadvertently), you could be subject to DHOAS rejoining provisions which can reduce or even cancel your DHOAS eligibility and entitlement. For further details, see Rejoining the ADF After a Break.  

IMPORTANT NOTE

 

Your eligibility and entitlement to DHOAS can change significantly if your circumstances change. For example,  if you separate from the ADF; your one-off, post-separation Subsidy Certificate expires after 12 months; or you do not complete effective service as a Reservist.

 

If you sought information about DHOAS some time ago and were advised at that time you were eligible for DHOAS or had a certain level of entitlement, please do not assume this advice remains valid if your circumstances have changed.

 

You are urged to speak again with a DHOAS assistant or to re-check this website to ensure your understanding of your eligibility and entitlement remains correct.  

Go to Top

Accessing Your DHOAS Entitlement

 

You can access your DHOAS entitlement while you're serving in the ADF, and then after you separate, you can also access any remaining years of accrued entitlement that you have not yet used.

 

To be eligible to access this entitlement and receive a monthly DHOAS subsidy payment, you need to meet a number of requirements which apply whether or not you are serving in the ADF or you are separated, including:  

  • have a DHOAS Service Credit (accrued entitlement);
  • have a valid Subsidy Certificate;
  • have a current, eligible DHOAS home loan, into which your subsidy can be paid;
  • meet the conditions of the Scheme and receiving the subsidy.   

Even if you have an accrued entitlement to DHOAS, you will be unable to access the monthly subsidy payments if you cannot meet the above requirements.

 

Therefore, a DHOAS Service Credit cannot be seen as a guarantee of benefits that will be paid to you for a certain length of time into the future, regardless of your circumstances. It is only indicative of how long you can receive DHOAS assistance as long as you meet the conditions. 

 

For example, you have a 10 year Service Credit but you close your DHOAS home loan after two years of subsidy. You cannot access the other eight years of entitlement unless you take out another DHOAS home loan and meet all other conditions. If you cannot do this then you cannot claim an entitlement to DHOAS.

 

How much you will be paid each month in DHOAS subsidy will depend on a range of factors, including:

  • your eligible subsidy tier;
  • the subsidised loan limit in your tier that is valid at the time you start receiving the subsidy;
  • the amount you have borrowed up to your subsidised loan limit;
  • median interest rate fluctuations; 
  • if you have taken out a loan with an eligible partner or other parties;   
  • if you are separated from the ADF and your eligible subsidy tier post-discharge, which is based on how many years you served before separating.

You can continue to receive the DHOAS subsidy on your existing DHOAS home loan and property for as long as you have a Service Credit; an outstanding balance on your home loan; and you meet the conditions of the Scheme.

 

Your subsidy amount will fluctuate, based on media interest rate changes; an increase in your subsidy tier due to reaching a service milestone; or a reduction in your subsidy tier as a result of separating from the ADF and not having completed sufficient service to maintain your tier level.

 

Changes to Existing DHOAS Arrangements

 

If you close or make changes to your existing DHOAS arrangements, you will need to apply to DVA for a new Subsidy Certificate if you want to set up subsidy payments under another arrangement.

 

Your eligibility and entitlement for DHOAS will be assessed on the DHOAS legislation and policy that apply at the time of your new application.

 

Please note the DHOAS Act was amended, effective from 22 July 2009, and there may be provisions that now apply to your application which did not apply at the time of your first application for a Subsidy Certificate. You are advised to contact the DHOAS service line to first discuss any plans to amend your existing DHOAS arrangements.  

 

You will need to take your new Subsidy Certificate to your Home Loan Provider, who will advise DVA to restart your subsidy payments based on your new DHOAS home loan or changes to your current DHOAS home loan.

 

DVA will recommence your subsidy payments, based on your eligibility and entitlement, home loan balance and subsidised loan limit that are valid at the time your payments are restarted.

 

Lump Sum     

If eligible, you may convert some or all of your accrued entitlement into a lump sum, up to a maximum of four years.

 

Please see Accessing the Lump Sum.

 

Accessing DHOAS After Separation

There are a number of factors you need to take into consideration about accessing DHOAS after you separate from the ADF:

 

  • You can access only one Subsidy Certificate post-separation.
  • You must apply for this Subsidy Certificate within two years of separating from the ADF.
  • The Certificate is valid for 12 months only. You must use the Certificate to take out a DHOAS home loan before it expires, if you want to start receiving your DHOAS subsidy payments. There are no options to extend the validity of the Subsidy Certificate beyond 12 months.
  • If you served for 20 or more years at the time you separated, you will receive Tier 3 payments post-separation. If you served under 20 years, you will receive Tier 1 payments.
  • If you continue to serve in the Reserves you will not be deemed to be separated for the purpose of DHOAS, as long as you continue to complete effective Reserve service each financial year. "Effective" Reserve service is defined as at least 20 days of active Reserve service within a financial year.
  • If you are currently in receipt of DHOAS subsidy payments, you need to advise DVA if you separate from the ADF, using the Change in Circumstances form.

You are advised to carefully consider the timing of your application for your post-separation DHOAS Subsidy Certificate and the intended use of this one Certificate.

 

If you are making instalments on a construction loan and you have separated, you may wish to defer applying for your post-separation Subsidy Certificate until construction is complete. This way you can use your Certificate to start subsidy payments on the full amount of your home loan, once it is fully drawn-down.

 

 

 

 

Go to Top

What is a Subsidy Certificate and how do I use it?

A Subsidy Certificate is evidence of your eligibility and entitlement for DHOAS.

To receive a Subsidy Certificate, you need to complete an Application for a Subsidy Certificate and post it to DVA for assessment.

You must attach your service records to your application and get your Commanding Officer or relevant delegate to sign and stamp your application.

Once DVA has determined you're eligible for DHOAS, we will send to you your Subsidy Certificate.

You take the Subsidy Certificate to one of the three appointed DHOAS Home Loan Providers to open a DHOAS Home Loan.  

Your Home Loan Provider will inform DVA when you have drawn-down on your home loan. This enables DVA to calculate your monthly DHOAS subsidy (based on the amount you have borrowed up to your subsidised loan limit) and to commence payments directly into your home loan account.

 

You can use a Subsidy Certificate only once to access DHOAS. Once your subsidy payments commence, the Subsidy Certificate you used to access them becomes invalid. 

 

If you make changes to your existing DHOAS arrangements and you want to restart your subsidy payments under other arrangements, you will need to apply to DVA for a new Subsidy Certificate.

 

You will then need to give this Certificate to your Home Loan Provider. Your Home Loan Provider will advise DVA to restart your subsidy payments under other arrangements, such as a draw-down milestone on a construction loan, a new home loan on another property or changes to an existing loan, such as an increase in the balance.  

 

While you're serving in the ADF, there is no limit to the number of Subsidy Certificates you can apply for, one at a time, as long as you have retained your eligibility and entitlement to DHOAS at the time of application.  

 

After you discharge from the ADF, you will have one opportunity only to apply for a Subsidy Certificate and you must apply for it within two years of separating.

 

Subsidy Certificate Valid for 12 Months Only

A DHOAS Subsidy Certificate is valid for 12 months from the date it is issued. The date of issue and the date of expiry is indicated on the Certificate. 

 

If after 12 months you have not used your Subsidy Certificate to draw-down on a DHOAS home loan and start your DHOAS subsidy payments, it will expire.

 

To receive another Subsidy Certificate, you must submit a new application to DVA.

 

Your new application, and your eligibility and entitlement to DHOAS, will be assessed in accordance with the legislation and regulations that are applicable on the date your application is received by DVA. This could result in changes from your original DHOAS assessment.

 

If you use your new Subsidy Certificate to restart DHOAS subsidy payments that were ceased, your new payments will be calculated on the subsidised loan limits and your DHOAS home loan balance that are current at the time your payments recommence. This may result in a different subsidy amount when compared to your earlier subsidy payments.

 

There is no discretion under the DHOAS Act to extend the validity of a Subsidy Certificate beyond 12 months, in any circumstances.

 

Please note: You are entitled to only one Subsidy Certificate after you separate from the ADF. You need to be cautious that if you've received your one post-discharge Certificate that you do not let it expire before you are able to use it and commence your subsidy payments.

 

One Subsidy Certificate Only after Discharge

You can access only one Subsidy Certificate after you separate.

 

You must apply for this Subsidy Certificate within two years of separating, and you must use it within 12 months of its issue.

 

That is, if you don't use it to take out a DHOAS home loan and start your subsidy payments within 12 months of receiving the Subsidy Certificate, it will expire and you will be unable to access another one.  

 

There is no discretion under the DHOAS Act to extend the validity of a Subsidy Certificate beyond 12 months, in any circumstances.

 

IMPORTANT: Please note that you can only apply for one Subsidy Certificate after discharge, not only be issued one Certificate after discharge.  This means that once DVA has received your correctly completed application you have expended your once-only application opportunity, whatever the outcome. Therefore, even if you withdraw the application, you will not be able to reapply in the future.

 

Options if Your Subsidy Certificate Expires  

  • If you are a member who is still providing effective service in the ADF, and your Subsidy Certificate expires, you can apply for a new Certificate.
  • If you are no longer providing effective service in the ADF, but your previous application for a Subsidy Certificate was made prior to you ceasing effective service, you are still able to apply for one more Subsidy Certificate, but no more than one. If you re-start effective service, you will be able to access further Subsidy Certificates.
  • If you lodged your previous application for a Subsidy Certificate after you discharged, but you expect that in the coming financial year you will complete effective Reserve service, or you will rejoin the Permanent Force. In this instance, you can apply for another Subsidy Certificate once you have rejoined and completed effective service.
  • If you lodged your previous application for a Subsidy Certificate after you discharged but you do not expect to perform effective service in the future, you will not be able to apply for another Subsidy Certificate. You used up your once-only, post-discharge opportunity to apply for a certificate with your previous application.  

IMPORTANT NOTE

 

Your eligibility and entitlement to DHOAS can change significantly if your circumstances change. For example,  if you separate from the ADF; your one-off, post-separation Subsidy Certificate expires after 12 months; or you do not complete effective service as a Reservist.

 

If you sought information about DHOAS some time ago and were advised at that time you were eligible for DHOAS or had a certain level of entitlement, please do not assume this advice remains valid if your circumstances have changed.

 

You are urged to speak again with a DHOAS assistant or to re-check this website to ensure your understanding of your eligibility and entitlement remains correct.  

Go to Top

DHOAS HOME LOANS

Defence has appointed a panel of three Home Loan Providers to offer you a choice of DHOAS-approved loans. These providers have the exclusive right to provide DHOAS home loans.  

 

Australian Defence Credit Union (ADCU), Defence Force Credit Union (Defcredit) and National Australia Bank (NAB) have developed a range of competitive home loan products as part of the Scheme arrangements.

 

All Home Loan Providers have branches across Australia and they're within reach of many members.

 

They can assist you with your home loan application and any inquiries you may have about buying a home and taking out a loan.

 

Home Loan Provider contact details:

 

Australian Defence Credit Union (ADCU)

Phone:  1300 2 DHOAS (1300 234 627)

Web:    www.adcu.com.au/DHOAS

 

Defence Force Credit Union (Defcredit)

Phone:  1800 033 139  

Web:    www.defcredit.com.au  

 

National Australia Bank (NAB)   

Phone:  13 13 12         

Web:    www.nab.com.au/defence

 

DHOAS Home Loans

The DHOAS differs from previous home ownership assistance schemes in that the assistance is not tied to a specific loan amount.   

The amount you may borrow will be a matter determined between you and your Home Loan Provider, depending on your own personal circumstances and your home loan provider's lending criteria.

 

This enables you to borrow an amount suited to your home buying needs, whilst receiving a DHOAS subsidy on an eligible portion of the loan.    

 

We recommend you read the Eligibility and Entitlement section to identify the subsidy tier under which you are entitled to receive assistance.

 

The Subsidised Loan Limit in your eligible subsidy tier will determine the portion of your home loan that can attract a DHOAS subsidy, and the maximum monthly subsidy payment that you can receive if you borrow that amount.   

 

You can contact one of the three Home Loan Providers for further details about the features of their loans.

 

Please note: DVA and Defence encourage you to seek professional advice, and to "shop around", before committing to a home purchase or loan to ensure it suits your particular circumstances.

 

Approval for Home Loans

 

You need to apply to one of the DHOAS Home Loan Providers for a home loan.

 

The Provider will assess your home loan application, based on their lending criteria, and will determine if you can borrow the amount you are seeking.

 

Please note eligibility for DHOAS does not mean approval for your home loan application.

 

Your Home Loan Provider is not obliged to approve your home loan application or to give you a loan of a certain amount, regardless of your DHOAS eligibility or subsidy tier level. 

 

Transfer Fees

Members who are refinancing an existing home loan with one of the DHOAS Home Loan Providers should note there may be costs associated with the transfer.

It is the responsibility of members to meet any transfer costs.

You are advised to investigate all costs associated with refinancing your mortgage.

Timing of Payments

 

You will receive your first DHOAS subsidy (along with your lump sum payment if you have selected that option) after your Home Loan Provider advises DVA that you have drawn down your loan and we process your payment. 

 

Payments are made at the start of each month, and cover the month or two months prior.

 

For example, if you draw down your loan in August, you will receive your first subsidy payment in early October. This first payment will be for September, and depending on the actual date within the month that you draw down, it may also be for August.

 

If you draw down your loan prior to the 10th business day before the end of the month, your first payment will cover two months of subsidy.

 

Please note: You will not receive your first subsidy payment (or your DHOAS lump sum) at the same time you settle your house, or at the same time your first housing loan repayment is due. Please note the above details for the timing of your first subsidy payment.

 

Construction Loans

Special conditions apply to Construction Loans, including around the need for a new Subsidy Certificate for each drawdown milestone and a requirement to occupy the home for 12 months from the time its occupiable (or within two years of receiving your first subsidy payment, whichever comes first). 

Redraws

Redrawing on DHOAS home loans is allowable, as long as you're drawing on additional funds you've deposited into the account and that the original loan amount does not increase.

 

Members who take out a DHOAS home loan and then proceed to make deposits above their minimum monthly repayments are entitled to draw on those extra payments.

 

This is regardless of how much your DHOAS subsidy payments contribute to you meeting your minimum home loan repayments. You can use these extra funds at your own discretion.   

 

Conditions

 

Purpose of Loan

 

DHOAS home loans can only be used for buying or building a home, buying land or renovating and extending your home, or to refinance a loan for one of these purposes.

 

You cannot use funds gained from a DHOAS home loan to buy investment properties, cars, boats, holidays or for other purposes.

 

For this reason, no lines-of-credit are available on DHOAS mortgage products.

 

If you're an existing home owner and you have an outstanding mortgage, you can refinance with a DHOAS home loan provider to access the DHOAS assistance (if eligible).  

 

However you can only receive a DHOAS home loan to the amount of your original loan, unless you need to borrow additional funds for the purposes allowed under the legislation.

 

For example, if you're refinancing with DHOAS you can't take out a larger home loan than your original mortgage only for the purposes of maximising your subsidy payments.

 

That is, you can't take out a larger DHOAS home loan then use the extra funds to make a lump sum deposit back into your DHOAS mortgage, or to use the funds for other purposes such as investing in another property.  

 

50% Interest in Home

 

It is a requirement that you hold, either alone or with your partner, a 50% or greater interest in the property. This means your ownership in the property is at least 50%, if you share that ownership with another party.

 

12 Month Occupancy

 

As the DHOAS is intended to help you achieve home ownership the main condition is that you and/or your family occupy your home for at least 12 months. You need to be occupying the home before your subsidy payments can commence.

 

If you have received your posting order and you know you will be relocating within the year then you cannot access DHOAS.

 

The reason is that you know it will not be possible to comply with a condition of the legislation, which is to occupy the home for 12 months from the time you start receiving the DHOAS subsidy.

 

If you receive a posting order after taking out a DHOAS loan in good faith that you would have stayed for 12 months, then your DHOAS subsidy assistance can continue on your home even though you've relocated and you're no longer living in it.

 

If you are posted and you have to move out before you meet the 12 month occupancy requirement, it is very important that you use the Change of Circumstances form to advise DVA before you move out.

 

If advised in advance, DVA will arrange an exemption to the occupancy requirement before you shift to ensure there is no disruption to your subsidy payments. If you wait until after you have moved your subsidy may be ceased or suspended, and you may have to repay any overpayments, until an exemption can be organised. 

 

Alternatively, you may elect to transfer the subsidy assistance to a property you purchase in your new location. You are also required to occupy this home for 12 months from when you start receiving DHOAS.

 

You can also continue to receive DHOAS if you're away from home but the property continues to be occupied by one or more of your dependents.

 

This occupancy requirement also applies to members who are refinancing their home with a DHOAS home loan.

 

Special conditions apply to construction loans, and the requirement to occupy the home for 12 months after building is completed.

 

PLEASE NOTE: If you received a waiver on the 12 month occupancy requirement and are receiving the DHOAS subsidy, if you close that DHOAS home loan and restart another, the occupancy waiver will not carry over to the other loan.

 

You will need to occupy the home over which you've taken out the new DHOAS loan for 12 months, from the time you start receiving the subsidy.

 

Before you close or make changes to your DHOAS home loan you are encouraged to contact DHOAS for further information, to ensure you understand the impact of these changes.

 

Change of Circumstances

You need to advise DVA of any change in the status of your DHOAS home loan. For further details, please see Change of Circumstances and Subsidy Ceasing Events.  

Go to Top

Your Subsidy Assistance

For full details about subsidy tiers, subsidised loan limits and monthly subsidy payments please see: Your Subsidy Assistance.

Go to Top

Switching to DHOAS from another scheme

If you currently receive benefits under the Defence HomeOwner Scheme (DHOS) or Defence Service Homes (DSH), you may also be eligible for assistance under DHOAS, as long as you have served on or after 1 July 2008 and have completed the qualifying period and gained a minimum Service Credit.

To access DHOAS, you will need to close your DHOS or DSH subsidised loan, and take out a DHOAS Home Loan (even if you are going to use DHOAS on a different property to the one for which you are receiving the DHOS or DSH subsidy).  You will need to pay any transfer costs associated with refinancing.  

Please note that only one subsidy scheme can be accessed at a time.  You cannot take out a DHOAS home loan and receive a DHOAS subsidy on one of your properties while also receiving DHOS or DSH on another property.

If you start to receive DHOAS payments on a property, your benefits from either DSH or DHOS on any other property will be cancelled, and any overpayments will have to be repaid.   

Under DHOAS, you're entitled to receive assistance up to the subsidised loan limit in your eligible subsidy tier (see Eligibility and Entitlements). 

A condition of the DHOAS is that you must live in your home for 12 months from the time you start receiving the subsidy payments.

Even if you have already lived in your home for a year, or you have met the DSH requirement to live in your home for 12 months, you are still required to meet the DHOAS 12 month occupancy requirement.

Impact on DHOAS entitlement

 

Please note that the length of time you have accessed DHOS or DSH will impact on how long you can access DHOAS.

 

You need to subtract the period of time that you have received the DHOS or DSH benefits from the length of your accrued DHOAS entitlement.

 

Your previous access to DHOS or DSH does not impact on your eligible subsidy tier or the amount of subsidy you receive, but on the length of time you can receive the DHOAS subsidy payments.

 

Please note a member can accrue a maximum of 20 years entitlement to DHOAS, without completing warlike service, and a maximum of 25 years with warlike service.

If you have previously accessed DHOS or DSH for this period of time - that is, for as long or longer than your maximum DHOAS entitlement of 20 or 25 years - then you will be unable to access DHOAS, even if you continue to serve in the ADF.

Example

You have served in the Permanent ADF for 16 years, which means you have an accrued entitlement to DHOAS of 12 years (total years of service minus your four year qualifying period).

However, you have received benefits under the old scheme, DHOS, for eight years. These eight years are subtracted from your 12 years of accrued entitlement.

This leaves you with four years of accrued entitlement to DHOAS. 

Your maximum entitlement to both DHOAS and DHOS combined is up to 20 years without warlike service and up to 25 years with warlike service.

Your previous access to DHOS does not affect the tier level under which you're entitled to DHOAS. In this example, as you have completed a total of 16 years of service, you're entitled to subsidy assistance at the Tier 3 level (as long as you're in the ADF.)

(Please note that after separation, benefits are paid at the Tier 1 level if you separate before completing 20 years of service, and at the Tier 3 level if you stay for over 20 years.)

 

Go to Top

Members entitled under Defence HomeOwner Scheme

DHOAS superseded the Defence HomeOwner Scheme (DHOS). which closed on 30 June 2010.

 

In some limited extenuating circumstances, members who were entitled under DHOS but could not apply for their benefits before the Scheme closed, can apply for similar benefits under DHOAS.

If eligible, you can access a DHOAS subsidy on an $80,000 subsidised loan limit.

 

Go to Top

Conditions of Accessing DHOAS

12 Month Occupancy Requirement

 

As the DHOAS is intended to help achieve home ownership the main condition is that you and/or your family occupy your home for at least 12 months.

 

You need to be occupying the home before your subsidy payments can commence.

 

If you have received your posting order and you know you will be relocating within the year then you cannot access DHOAS.

 

The reason is that you know it will not be possible to comply with a condition of the legislation, which is to occupy the home for 12 months from the time you start receiving the DHOAS subsidy.

 

If you receive a posting after moving into a DHOAS subsidised property in good faith that you would have stayed for 12 months, then your DHOAS subsidy assistance can continue on your home even though you've relocated and you're no longer living in it.

 

If you are receiving a DHOAS subsidy and you learn that you're to be posted, it is very important to advise DVA by the Change of Circumstances form before you make the shift. DVA will arrange an exemption to the occupancy requirement before you shift to ensure there is no disruption to your subsidy payments. If you wait until after you have moved your subsidy may be ceased or suspended, and you may have to repay any overpayments, until an exemption can be organised.

 

Please note that special conditions apply to construction loans and the 12 month occupancy requirement. Further details are provided below.  

 

You may elect to transfer your DHOAS subsidy assistance to a property you purchase in your new location. You are also required to occupy this home for 12 months from when you start receiving DHOAS.

 

If you're away from home but the property continues to be occupied by one or more of your dependents, you can continue to receive DHOAS.  

 

This 12 month occupancy requirement and other conditions also apply to members who are refinancing their home with a DHOAS home loan and making other significant changes to their DHOAS home loan.

 

Construction Loans and 12 Month Occupancy

You have two years from when you first start receiving DHOAS subsidy payments to complete the construction process and to occupy the home, if you want your DHOAS subsidy payments to continue.

Upon completion of construction, once your property is deemed "occupiable", you are required to occupy the home for 12 months.  

If you cannot meet these conditions, your subsidy will stop.

You can re-apply for a new Subsidy Certificate and re-commence payments when you are able to start occupying the home and remain in the property for 12 months. 

If you receive a posting and you are unable to move into your DHOAS-subsidised home once it becomes occupiable (or after two years, whichever comes first), your subsidy payments will cease.

You will be unable to get a waiver on the 12 month occupancy requirement if you cannot live in the home for any period of time before you have to move due to the posting.

However, if you can forewarn DVA of a posting (using the Change of Circumstances form) and you can also occupy the home for a period of time before the posting takes effect, you may receive a waiver on the 12 month occupancy requirement.   

There are a number of other special conditions that apply to construction loans. For further details, please see "Construction Loans".

After Completion of 12 Months Occupancy 

 

After you have occupied your subsidised home for 12 months, you can continue receiving your subsidy payments into your DHOAS home loan, regardless of whether or not you reside in the house.

 

You can receive your subsidy as long as your existing DHOAS home loan remains current and is not paid out.

 

You can rent out the property and still receive your DHOAS subsidy payment, as long as your DHOAS home loan remains current.

 

If you rent out your subsidised house, it is recommended that you seek independent tax advice about the implications of receiving the DHOAS subsidy on an investment property.  

 

If you refinance the subsidised property for any reason you will need to apply for another Subsidy Certificate and to restart your subsidy payments. This would reinstate the 12 month occupancy requirement.

 

Moving Out Before Completing 12 Month Occupancy

 

If you move out of your subsidised property before you have occupied the home for 12 months you will need to advise DVA (using a Change of Circumstances form.)  DVA will cancel the DHOAS payments made into your DHOAS home loan.   

 

If you continue to receive DHOAS payments on the property although you have moved out, you will be required to repay any overpayments.  

 

You can apply for a new Subsidy Certificate and again receive DHOAS subsidy payments into a DHOAS home loan when you re-occupy your existing home or occupy a new subsidised home.

 

You will be required to live in the home for 12 months from when your subsidy payments are reinstated.

 

Selling Your Subsidised Home and Transferring DHOAS to a New Property 

 

If you sell your DHOAS-subsidised home and you want your DHOAS subsidy transfered to your new property, you will need to apply for another Subsidy Certificate to restart your subsidy payments on the new house.

 

This is required even if for some reason your home loan remains the same.

 

You will need to take the Subsidy Certificate to your Home Loan Provider who will advise DVA when you have drawn down the DHOAS home loan on your new property and your subsidy payments can recommence.

 

This will reinstate the 12 month occupancy requirement, from the time your subsidy restarts.  

 

Previously Occupied Home

 

If you own a home that you have previously resided in for 12 months, but do not occupy currently, this does not mean you can start receiving DHOAS subsidy payments.

 

You will need to re-occupy your home for the subsidy payments to commence, and remain in the home for 12 months for the payments to continue.  

 

Changes to DHOAS Home Loans and 12 Month Occupancy

 

If you close your existing DHOAS home loan and take out another loan, either on a new home or over your existing home, you will need to re-apply for a new Subsidy Certificate and have your DHOAS subsidy payments re-assessed. This also applies if you make significant changes to your existing home loan.

 

In these instances, you will be required to again meet the 12 month occupancy requirement from when you start receiving the new round of subsidy payments.  

 

This also applies if you change the nature of your existing home loan, for example, if you increased the balance of your loan and you wanted to access a higher subsidy payment.

 

If you received a waiver on the 12 month occupancy requirement and are receiving the DHOAS subsidy, if you close that DHOAS home loan and restart another, or make significant changes to your existing loan, the occupancy waiver will not carry over to the new or changed loan.

 

You will need to occupy the home over which you've taken the new DHOAS loan for 12 months, from the time you start receiving the new round of subsidy payments.

 

PLEASE NOTE: Before you close or make changes to your DHOAS home loan you are advised to contact DHOAS for further information, to ensure you understand the impact of these changes.

 

Purpose of DHOAS Home Loans 

 

DHOAS home loans can only be used for buying or building a home, buying land or renovating and extending your home, or to refinance a loan for one of these purposes.

 

You cannot use funds gained from a DHOAS home loan to buy investment properties, cars, boats, holidays or for other purposes.

 

For this reason, no lines-of-credit are available on DHOAS mortgage products.

 

If you're an existing home owner and you have an outstanding mortgage, you can refinance with a DHOAS home loan provider to access the DHOAS assistance (if eligible).  

 

However you can only receive a DHOAS home loan on the outstanding amount of your original loan, unless you need to borrow additional funds for the purposes allowed under the legislation.

 

For example, if you're refinancing with DHOAS you can't take out a larger home loan than your original mortgage only for the purposes of maximising your subsidy payments.

 

That is, you can't take out a larger DHOAS home loan then use the extra funds to make a lump sum deposit back into your DHOAS mortgage, or to use the funds for other purposes such as investing in another property.  

 

If you refinance with DHOAS you will need to cover the cost of any transfer fees.

 

It is also a condition of receiving DHOAS that you and/or your family reside in the home you're refinancing for at least another 12 months, and that you hold, either alone or with your partner, a 50% or greater interest in the property.

 

Home Loan Redraws

 

Redrawing on DHOAS home loans is allowable, as long as the original loan amount does not increase.

 

Members who take out a DHOAS home loan and then proceed to make deposits above their minimum monthly repayments are entitled to draw on those extra payments.

 

This is regardless of how much your DHOAS subsidy payments contribute to you meeting your minimum home loan repayments. You can use these extra funds at your own discretion.   

 

50% Interest in Home

 

It is a requirement that you hold, either alone or with your partner, a 50% or greater interest in the property.

 

This means your ownership in the property is at least 50%, if you share that ownership with another party.  

 

Use of Property for Business

 

The DHOAS subsidy cannot be paid on a mortgage over a property which is used - primarily - for the purpose of carrying on a business, trade or profession.

 

Based on Sections 35 and 41 of the DHOAS Act, subsidy will cease to be paid if a property is used in this manner.

 

This rule applies to the use of the home and land regardless of who is carrying on the business. Therefore, it applies to activity carried out by any of the following:

  • ADF member
  • Partner
  • Children
  • Boarders
  • Tenants
  • Any other (for example, a share farmer)

Definition of Business 

 

An activity can generally be considered a business if it is carried out for income or profit. The Australian Tax Office (ATO) website has information to assist in determining if a business exists for tax reasons.

 

DVA would generally expect that the DHOAS treatment, and the tax treatment would align. Therefore, if the activity is reported on a tax return (or would be required under law to be reported on a tax return), has an ABN and is registered for GST, then the business most likely exists for DHOAS purposes.

 

This excludes genuine hobbies, for example the sale of arts and crafts of a minor nature or non-profit activities such as meetings of Rotary and Apex.

 

Assessing Primary Use

 

There are a number of factors to take into account when determining if a property is used primarily for business.

 

They inlude:

  • Size of business
  • Proportion of land used for business
  • If customers visit the property, and how many
  • The extent to which the business is actually carried out on the property
  • The extent to which the property especially caters for the activity

Examples of inconsequential activities that do not impact on DHOAS eligibility:  

  • Small Amway business for sales to family and friends
  • Giving piano lessons two afternoons a week
  • Running a Jims Mowing or plumbing business from the house
  • A small home office in one room

Examples of primary use that can result in subsidy payments being ceased: 

  • 500 head of cattle on 300 acres
  • Running a larger and specialised professional business, such as a doctor, dentist or veterinary practice
  • Running a multi-bedroom B & B (bed and breakfast)  

Change of Circumstances and Subsidy Ceasing Events

You need to advise DVA about significant changes that could impact on your DHOAS eligibility and entitlement.

 

Some changes to your ADF service or DHOAS home loan may result in your subsidy being stopped. Refer to Change of Circumstances and Subsidy Ceasing Events for further details.

  

Policing Conditions of the Scheme

 

Defence has responsibility for policing the conditions of the Scheme, and has established processes - including working with DVA and the Home Loan Providers - to ensure members comply with the legislation.

 

Remember it is your responsibility to ensure you understand and comply with the conditions of receiving DHOAS.

 

Possible consequences of not complying with the conditions include:

 

* Cessation of subsidy payments

* Repayment of subsidy payments received, including from the sale of the property or an increase in the home loan

* Prevention from future access to the Scheme

* Disciplinary action or criminal prosecution

 

Understanding the Conditions

It is your responsibility to ensure you understand the conditions of accessing DHOAS.

When you receive your Subsidy Certificate you are also sent a fact sheet called "About Your Subsidy". Your letter of approval advises you to read this fact sheet.

It provides important information about the conditions of accessing DHOAS. There is also further information available on this website.

Go to Top

Exemption based on exceptional circumstances

Either Permanent or Reserve Members who do not complete effective service for the purposes of their DHOAS eligibility and entitlement, may apply to the relevant DGPERS for an exemption based on exceptional circumstances.

In general, "exceptional" circumstances would not include, for example, maternity leave or study leave. 

Members are advised to discuss a request for an exemption with their chain of command before submitting a request.

Postal addresses for DGPERS

DGNPT Director General Navy Personnel and Training: R8-1-016, Russell Drive, Canberra, ACT 2600

DGPERS Director General Personnel - Army: R8-9-025, Russell Drive, Canberra, ACT 2600

DGPERS Director General Personnel - Air Force: R8-0-019, Russell Drive, Canberra, ACT 2600

Go to Top