Dear All,
The Deposit Challenge
Saving for a home deposit can take years. Lenders now offer high LVR (Loan-to-Value Ratio) loans — sometimes up to 105% — to help buyers enter the market sooner.
While these higher LVR loans can open doors, they often come with greater long-term cost and risk.
By comparison, pairing a home loan with an AffordAssist Deposit Certificate achieves the same goal — entering the market sooner — while keeping borrowing safer, repayments more manageable, and equity growth faster.
Understanding Higher LVR Loans
Higher LVR loans — including 95%, 98%, and 105% LVR — that are not paired with AffordAssist may help buyers with little or no deposit. However, they also increase financial exposure because you’re borrowing more than the property is worth.
- Greater exposure to interest rate rises
- Slower equity growth
- Higher total interest over the life of the loan
The Risk of Borrowing Above the Property’s Value
With a 105% LVR loan, you begin homeownership with negative equity. Even small market changes or personal financial events can create long-term risk.
- Negative equity: You could owe more than the property’s value if prices fall
- Refinancing challenges: Limited options until you build sufficient equity
- Slower equity growth: Early repayments mainly cover interest
- Higher interest costs: Any increase in rates directly impacts repayments
Long-Term Impact: Comparing a 105% LVR loan to a 90% LVR loan, the 15% lower borrowing could save hundreds of thousands in interest over the life of the loan.
Higher-LVR loans may offer quicker access, but they come with greater risk, and more long-term cost.
The AffordAssist Advantage: Lower Borrowing, Safer Ownership
Pairing any home loan with an AffordAssist Deposit Certificate allows buyers to secure a property sooner — without overextending their debt. The Deposit Certificate covers part of the deposit interest-free, reducing the loan’s LVR and keeping borrowing lower.
This structure:
- Reduces borrowing costs and exposure to market downturns
- Keeps repayments manageable and builds equity faster
- Encourages responsible lending and avoids excessive leverage
- Promotes earlier financial resilience and long-term stability
With AffordAssist, buyers enter the market sooner and build equity faster — achieving sustainable ownership without borrowing dangerously.
AffordAssist Product Scope
AffordAssist Interest-Free Deferred Deposit Solution — A Smarter Alternative to Cash Deposits
Purchase a property from a willing seller using a partial deposit upfront, and defer the remaining deposit — interest-free for up to 60 months — while enjoying 100% ownership from day one.
AffordAssist isn’t limited to high LVR loans. Buyers with available savings can pair AffordAssist with traditional 85%, 80%, or even 75% LVR loans, gaining the same affordability advantages without increasing bank debt.
When applying for your home loan, ask your mortgage broker for two approval options:
- A standard home loan
- A home loan paired with an AffordAssist Deposit Certificate
Evaluating both options side by side shows how repayments and total interest can differ when pairing with AffordAssist.
Example: Why This Matters — and Is It Worth the Effort for Buyers?
- Enter the property market sooner — without extra loan debt or pressure on family
- Reduce the loan amount by 10% on an $800,000 purchase = $80,000
- Typical repayments to a lender (≈3×) = $240,000
- With AffordAssist — Interest-free = $80,000
→ You save approximately $160,000
This flexibility allows AffordAssist to be integrated across a wide range of lending strategies — from first-home buyers to accountants, financial planners, mortgage brokers, and lenders designing lower-risk, smarter ownership solutions.
Which Option Fits You Best?
High LVR Loans (without AffordAssist)
Enter the market quickly but face higher repayments, increased exposure, and long-term risk.
Home Loans Paired with AffordAssist
Achieve sustainable ownership, lower debt, and faster equity growth while using a flexible Deposit Certificate.
Both paths get buyers into the market sooner — but AffordAssist promotes smarter, safer, and more sustainable ownership.
Less debt. Lower risk. More control.
Final Thought
The best question isn’t “How can I borrow more?” — it’s “How can I borrow smarter?”
High-LVR loans may get you in the door, but pairing your home loan with AffordAssist helps you hold your property and build intergenerational wealth — through stronger equity, lower interest costs, and long-term financial freedom.
Regards
AA
B2B – AffordAssist facilitates and oversees the governance process. Are you a mortgage broker, lender, developer, real estate agent, affordable housing advocate, or housing minister? We welcome your collaboration. Join us in our mission to expand access to home ownership. Together, we can make a lasting impact.