Couple, no dependents

Household income $94,000/year, $18,000 deposit, first home buyers

Alex and Michael have recently decided to buy a place together. Together they earn $94,000 per year and have saved up $18,000. They are looking for a home no more than 10 kilometres from the city that will give them an easy commute to work.

HomeSeeker SA has some properties for sale in great suburbs that are only available to eligible buyers under a shared equity arrangement. 

Shared equity home loans allow you to increase your borrowing power, without increasing your home loan repayments. With shared equity, you may be able to buy a home in a better location because the mortgage repayments will be lower. Read more about how shared equity works in our FAQs

Alex and Michael approach HomeStart Finance to discuss if a shared equity loan will work for them. They have some other debts, such as a car loan, which has lead to them being rejected by some lenders due to their capacity to meet home loan repayments.

Through HomeSeeker SA they find a home in an inner west suburb that is advertised at $480,000. They are also eligible for the HomeStart Finance Starter Loan, which contributes up to $10,000 towards fees and charges.

Alex and Michael work out their repayments as follows.

Monthly household income after tax

$5,900

Home purchase price

$480,000

Stamp duty + other fees

$28,350

Borrowed amount ($508,350) less deposit ($18,000), First Home Owner Grant ($15,000) + Starter Loan ($9,750)

$465,600

Monthly repayments on loan

Monthly repayments on loan using shared equity

$2,451

$1,837

Disclaimer

This fictional case study is based on real life experiences of home buyers. Before buying a home, it is strongly recommended you seek professional advice on your personal financial circumstances and your ability to pay a mortgage.