Buying Your First Home With a Partner
Two incomes lift what you can borrow, and two sets of commitments reduce it. A few things that seem administrative, whose name is on the title, whether either of you has owned before, are worth settling before you start looking rather than a week out from settlement.
Two incomes, one assessment
A lender assessing a joint application does not run two separate sums and add them up. It combines your incomes, combines your commitments and living expenses, and works out the surplus available to service a loan.
That matters because a debt in one person's name reduces the household's capacity just as much as if it were in both. A car loan, a credit card limit or a HELP debt belonging to one of you comes off the joint figure. What a HECS debt costs your borrowing power.
Buying together is usually stronger
For most couples the maths works in their favour. Two incomes against one set of living expenses generally produces more capacity than either person has alone, often substantially more, and the deposit comes together faster.
The exception is where one person carries significant debt or a credit issue. Occasionally a single application on the stronger income is the better outcome, though it comes with its own consequences for ownership and eventual capacity. It is worth modelling both rather than assuming.
If one of you has owned before
This is the detail that most often surprises couples, and it is worth checking early because it affects money rather than paperwork.
The NSW First Home Buyers Assistance Scheme is administered by Revenue NSW and generally requires all purchasers to meet the eligibility criteria. If one of you has owned residential property before, the concession may not be available to either of you.
Housing Australia administers the deposit guarantee schemes, and eligibility is assessed for each applicant. Buyers who have not owned property in the last ten years can qualify in some circumstances.
The First Home Owner Grant has its own eligibility rules, again applied to the purchasers rather than to one of them.
Prior ownership does not always disqualify. The rules distinguish between having owned and having lived in what you owned, and timeframes matter.
These are the amounts that make or break a budget. Confirm eligibility with the scheme administrator before you commit to a price, not afterwards.
Eligibility should be confirmed directly with Revenue NSW and Housing Australia, and with your lender.
How you own it
There are two ways to hold a property jointly in New South Wales, and the difference is not cosmetic.
Joint tenants means you own the whole property together, in equal shares, and if one of you dies the other automatically takes full ownership. It is the usual choice for couples and it sits outside a will.
Tenants in common means you each own a defined share, which can be unequal, and each share can be left to whomever you choose. It suits people contributing different amounts, or who want their share to pass to someone other than the other owner.
Your conveyancer or solicitor sets this up at purchase. It is easy to decide at the time and awkward to change later, so it is worth an actual conversation rather than a default.
What joint borrowing actually means
A joint loan makes you both liable for the whole debt, not for half of it each. If one of you cannot pay, the lender can pursue the other for the full amount, regardless of what you agreed between yourselves or what share of the title you hold.
That is not a reason not to buy together. It is a reason to understand that the loan and the ownership are separate arrangements: your shares on the title can be unequal while your liability on the loan remains total for both of you.
The other practical effect is that the loan appears in full on both of your credit files, which affects what either of you can borrow separately afterwards.
Conversations worth having first
Unequal deposits
If one of you is contributing more, decide now whether that is a gift to the relationship or a share to be recognised. Tenants in common with unequal shares is the usual way to record it. Families often expect this to be documented where a parental gift is involved. More on gifted deposits.
What happens if things change
Nobody enjoys the conversation, and it is far easier before settlement than after. Legal advice about how the property would be treated if the relationship ended is a matter for a family lawyer, not a broker, and worth taking where the contributions are uneven.
Whose credit file is whose
Both files are checked. A default, a missed payment history or a high card limit belonging to one of you affects the joint application, and it is much better to know about it early than to have it emerge during assessment.
The buffer
Two incomes are more capacity but also more exposure: a household relying on both is more affected if one stops. Parental leave, a redundancy or a period of illness are worth planning for at the point you choose a price, not after you have committed to one.
Not married, or not yet
Lenders do not require you to be married, and de facto couples are assessed the same way. What lenders care about is whether you are financially interdependent, because that determines whether they assess you as one household or two.
If you keep entirely separate finances and are buying together as something closer to co-investors, that is a different structure again and worth saying so at the outset. The first home buyer checklist covers the sequence either way.
What we do
Work out what you can borrow together and, where it matters, what each of you could borrow alone, so the choice is made on numbers.
Flag the eligibility questions early, particularly where one of you has owned before, because that is the one that most often changes a budget late.
And match you to a lender whose treatment of both your incomes and both your commitments produces the best outcome. Start with your borrowing position.
Put numbers on it
Borrowing power
Try it with your combined income, then with one.
OpenDeposit strategy
What you need saved between you, and what each size changes.
OpenNSW stamp duty
What the concession is worth, and what it costs to lose it.
OpenFull cash requirement
Deposit, duty and costs at a specific price.
OpenRepayments
What the monthly figure looks like on two incomes.
OpenYour buying position
A written report across deposit, costs and pathways.
OpenFind out what you could realistically buy together
Both incomes, both sets of commitments, and the eligibility questions checked before they can change your budget. Free, no credit check.
Common questions about buying together
My partner has owned a home before. Can we still get the first home buyer benefits?
It depends on the specific scheme, and this is the detail most worth checking early. The NSW stamp duty concession generally requires all purchasers to meet the criteria, so one person's prior ownership can affect both. The federal deposit schemes have their own rules, and buyers who have not owned in the last ten years can qualify in some circumstances. Confirm your position with Revenue NSW, Housing Australia and your lender before you commit to a price.
Do we have to be married?
No. Lenders assess de facto couples the same way as married couples, and you can buy together without being either. What matters to a lender is whether your finances are interdependent, because that decides whether you are assessed as one household or as two people with separate expenses. Some scheme rules do use relationship definitions, so it is worth confirming those separately.
Does my partner's debt affect what we can borrow?
Yes, in full. A joint application combines both incomes and both sets of commitments, so a car loan, a credit card limit or a HELP debt in one name reduces the household's capacity exactly as if it were in both names. Credit card limits are assessed on the limit rather than the balance, which is why reducing or closing an unused card before applying can be worth doing.
Can we buy with only one of us on the loan?
Sometimes, and occasionally it is the better outcome, for example where one person has a credit issue or heavy existing debt. It comes with trade-offs: the loan is assessed on one income, so capacity is usually lower, and ownership and scheme eligibility both need thinking through. It is worth modelling both structures rather than assuming the joint one is automatically better.
Joint tenants or tenants in common?
Joint tenants means you own the whole property together and the survivor automatically takes full ownership, which is the common choice for couples. Tenants in common means you each hold a defined share, which can be unequal and can be left to someone else in a will. Unequal deposits are the usual reason to choose tenants in common. Your conveyancer or solicitor sets this up at purchase, and it is much easier to decide then than to change later.
We are contributing different deposit amounts. How do we protect that?
Holding the property as tenants in common with shares reflecting the contributions is the usual approach, and it is recorded on the title at purchase. Where a family gift is involved, the family often expects this. Beyond the title, a financial agreement is a matter for a family lawyer rather than a broker, and it is a much easier conversation before settlement than after.
Are we both liable for the whole loan?
Yes. Joint borrowers are each liable for the full debt, not for half of it, regardless of your shares on the title or what you have agreed privately. If one of you stops paying, the lender can pursue the other for the whole amount. The loan also appears in full on both credit files, which affects what either of you can borrow separately afterwards.
Should we plan around both incomes or one?
Lenders will assess you on both, and a buffer is worth building in yourselves. If parental leave, study or a career change is likely within a few years, working out what the repayments would feel like on one income for a period is a sensible test of the price you choose. It is a question about comfort rather than approval, and it is easier to answer before you commit.
Related reading
First home buyers
Deposits, schemes and the path from first call to keys.
OpenGifted deposits
Family help, and what a gift letter has to say.
OpenHECS debt and home loans
Common on one side of a couple, and it counts against both.
OpenLow deposit home loans
Every route in with less than 20 per cent, compared.
OpenWork it out together, before you start looking.
Twenty minutes covers what the two of you could borrow, which benefits you are eligible for, and the questions worth settling before you make an offer.