The short version
- DHOAS pays part of your home loan interest each month, for up to 20 years in most cases.
- You must use one of the scheme's approved lenders, and get a subsidy certificate first.
- You or your family must live in the home for at least 12 months.
If you are a member of the Australian Defence Force, working in the Army, Navy or the Air Force as a permanent member or a reservist, you may qualify for a discounted home loan that falls under the Australian Defence Force Home Ownership Assistance Scheme (DHOAS).
The scheme gives you a monthly subsidy towards the interest on your home loan, on top of the loan's normal terms. It's offered through three lenders, the Australian Military Bank, Defence Bank and NAB.
Eligibility criteria
ADF service related criteria
If you are a member of the Australian Defence Force (ADF), here's what you need to become eligible for the DHOAS subsidy.
- You must be serving in the ADF, or have served recently. Former members get one chance to apply for a subsidy certificate after they leave, using the entitlement they built up while serving.
- You have to have completed a minimum qualifying period of service. For both permanent and reserve members, there are minimum service requirements to fulfil in order to qualify for the scheme.
- You must have accrued Service Credit, also referred to as the DHOAS entitlement, by completing effective service.
- You need to meet the conditions that come with the assistance scheme.
Subsidies are granted on a tiered basis, depending on how long you've served. The Subsidised Loan Limits (SLLs) for each tier are updated each July. For 2026-27 they are:
| Tier | Permanent service | Reserve service | Subsidised loan limit | Maximum monthly subsidy |
|---|---|---|---|---|
| 1 | 2 years | 4 years | $455,622 | Up to $588 |
| 2 | 4 years | 8 years | $683,433 | Up to $882 |
| 3 | 8 years | 12 years | $911,244 | Up to $1,176 |
The most current rates are available on the DHOAS website.
Permanent members
The minimum qualifying period for permanent members is two consecutive years of service. After that, you build up one month of entitlement for every month you serve.
In most cases the maximum is 20 years of subsidy, with a 25 year limit for those who have had warlike service. Years already received under an earlier Defence home scheme are deducted.
Reserve members
Reservists need to complete four consecutive years of effective service before they can qualify, where a year of effective service means at least 20 days of paid service in a financial year. Once you have qualified, you build up a year of subsidy entitlement for every financial year in which you complete 20 days of paid service. A break in service means starting the qualifying period again.
Factors that may impact your eligibility for the Defence Force home loan subsidies:
- Switching from being a permanent member to a reservist
- Taking a break in service and returning to service
- Leaving the ADF
Occupation as a condition for eligibility
The DHOAS is meant to support home ownership. As such, occupancy is a key requirement for being eligible for the DHOAS subsidy. You and / or your family must live in the subsidised home for at least 12 months from when the subsidy starts. If you're posted elsewhere, payments can continue while your family stays in the home, and you can apply to reduce the occupancy period before you move out.
Lender considerations
Lenders will review your specific situation to understand the many variables that could impact your eligibility for a Defence Force home loan.
- The subsidy doesn't remove the need for Lenders Mortgage Insurance (LMI) if you borrow more than 80% of the property's value, although some Defence lenders offer their own LMI deals or waivers.
- A deposit of at least 5% of your home purchase price is required by most lenders.
- A guarantor can be used if you wish to borrow 100% or more of the purchase price. Loan terms differ from lender to lender.
- You can only have one DHOAS subsidised loan at any given time, and it must be secured on the subsidised home.
Considerations
Should you consider a professional package?
Professional packages are best suited for those who need to borrow larger amounts, often $150,000 or more, and want other facilities like credit cards and transaction accounts rolled into one institution. A professional package charges a single annual fee, often around $400, depending on the package. It would be worth considering a professional package should the potential saving in fees be big enough when comparing the one-off pro pack fee versus the total annual fees you'd pay on separate products.
Getting a second property as an investment
There are a number of options open to you on how to get an investment property.
Getting a second DHOAS home loan
Once you have completed the 12 month occupancy requirement, check with DHOAS before renting out your subsidised home, as the rules on keeping the subsidy depend on your circumstances. If you rent it out, get independent tax advice too.
If you sell your home and close the DHOAS loan, you can use any remaining entitlement on your next home, but the occupancy rules apply again.
You can find more information on using your remaining entitlement on another home on the Defence Home Ownership Assistance Scheme website.
Go for a Defence Housing Australia (DHA) investment property
If you are an ADF member buying a DHA property, keep in mind that your entitlements may be affected in case you are posted to the same location as your investment property.
DHA has investment opportunities in a range of investment properties across the nation at a variety of prices. You could choose from a range of townhouses, units and houses in regional areas, smaller cities, and in state capitals like Sydney and Melbourne, depending on the size of loan you can get.
You may:
- Borrow up to 90% or 95% of the property value with LMI, depending on the lender.
- Borrow up to 90% without LMI with some lenders that offer waivers for DHA properties.
- Borrow up to 100% of property value with a guarantor.
- Have more of the rental income counted than usual. DHA charges a property management fee, often around 16.5% of the rent, and some lenders count the rest of the guaranteed rent in full.
You can get more information at the DHA website.
Consider working with a mortgage broker
Only three lenders are approved to offer DHOAS subsidised loans. Working with a knowledgeable mortgage broker can open up a wider choice of lenders and help you get a more advantageous loan for your situation.