How Does DHOAS Work? A Guide for ADF Members
How to make the most of your Defence Home Ownership Assistance Scheme entitlements when buying or refinancing.
The Defence Home Ownership Assistance Scheme (DHOAS) provides eligible current and former Australian Defence Force (ADF) members with a monthly subsidy on their home loan interest. The subsidy amount depends on your length of qualifying service and the size of your loan.
How the DHOAS scheme works
To access DHOAS, you must meet the qualifying service period and obtain a DHOAS Subsidy Certificate from the Department of Veterans' Affairs (DVA). You must then take out a home loan with one of the three nominated DHOAS Home Loan Providers (Defence Bank, Australian Military Bank, or NAB). The scheme operates on a three-tier system based on your years of effective service, with each tier offering a higher maximum subsidised loan limit.
Illustrative example
Illustrative example: An ADF member with 9 years of effective service qualifies for Tier 2. If they have a $600,000 home loan, they will receive a monthly subsidy calculated on a portion of their loan up to the Tier 2 maximum limit. This subsidy is paid directly into their home loan account each month, effectively reducing the total interest paid over time.
What may change the outcome
Your subsidy amount can fluctuate because it is tied to the median interest rate of the nominated DHOAS providers. If market interest rates change, your monthly subsidy payment may also change. Additionally, if your loan balance falls below your eligible tier limit, the subsidy will be calculated on the lower actual loan balance.
Common misunderstandings
A common misconception is that a DHOAS loan always offers the cheapest overall outcome. While the subsidy provides a significant benefit, it is important to compare the underlying interest rates and fees of the nominated DHOAS providers against the broader market to ensure the net outcome is genuinely competitive.
When a personal review may help
Navigating the interaction between DHOAS entitlements, lender policies, and your personal borrowing capacity can be complex. A broker familiar with the scheme can help you compare DHOAS options against non-DHOAS lenders to find the structure that best supports your objectives.
Next step
Estimate your potential monthly subsidy using our DHOAS Calculator, or learn more on our dedicated ADF & DHOAS service page.
This article provides general information only and does not take into account your objectives, financial situation or needs. It does not constitute personal credit, financial, tax or legal advice. Lending outcomes depend on individual circumstances, lender policy and assessment.
Have questions about your situation?
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