Want a loan but don't want to make any repayments? 

As one solution to the affordability problem for many people, an Australian bank has just launched a new product, referred to as a Shared Equity Home Loan.  It is hoped that this product will make it easier for some people to get into the housing market.

This loan product allows home owners to borrow as little as 75% of the value of their home, after putting up a 5% deposit.

The remaining 20% will be covered by what is called an Equity Finance Mortgage or EFM.

The borrower is not required to pay any interest or principal repayments on this 25-year mortgage, but when the house is sold, the bank gets 40% of the total capital gains achieved on the sale.

If the house has declined in value, the bank absorbs up to 20% of the loss.

If you are interested in this type of loan we would be happy to guide you through the process.

Please click here to open an information booklet about EFM loans.

This booklet explains what an Equity Finance Mortgage loan (‘EFM loan’) is and how an EFM loan can help you to purchase a home when it is taken in conjunction with a traditional home loan, or, how an EFM loan can be used to refinance an existing home loan or consolidate other debts.  You will find a number of practical examples of taking out an EFM loan, repaying an EFM loan and other events that may happen when you have an EFM loan such as renovating your home and borrowing more money. The information provided in this booklet is of a general nature only and does not take into account your individual objectives, financial situation or needs. You should consider this booklet before making any decision about whether an EFM loan is appropriate for you, taking into account your own needs and financial circumstances.