Hi Goblin,
Firstly, welcome to the Property Forum.
Some things that you may wish to consider are:
Living at home and paying $38 per week in board is great...take advantage of this (this is how I managed to buy my first and pay a lot of money off the principal in the first couple of years.
If the properties that you are looking to buy are positively geared and you live in inner Sydney, the properties are either short stay/student type accomodation or are on the urban fringe/rural nsw/some other state....do you have the experience to manage these properties or have someone you can trust to do this for you?
You have $10,000...this is fantastic. Can you show a financial institution that you saved this money rather than being given it as a gift...this is the type of question that a financial institution will ask you to help them grade the risk that you present them.
The $7,000 First Home Owner's Grant is a grant, not a deposit and you do not have any claim to this until the property has settled. To do this, you generally need to qualify for the property without the grant. To be eligible for the grant, you will need to advise your financial institution that you will be buying the property with a view to being an Owner Occupier, in which case they will not take possible rent in to account when detirmining your ability to service the loan. To service the loan, the bank will take into account 30% of your gross income..therefore if you make $300 per week they will not lend any more than $100 per week will pay off. There is nothing stopping you getting the grant and then renting the property 3 months later due to a change in circumstances.
Goblin, great to see that you are "fired-up" and looking to get ahead in life buuuuut, using the term "Business Partner" to refer to one of you family members willing to put their family home up as security for the loan will earn you no respect. Don't be afraid to fully explain your situation, it will result in better directed responses.
To work out whether they will lend you money, financial institutions require 2 things from you (not either, but both!) - equity (be it cash or equity in other assets) and the ability to repay the loan. With equity, to get a loan without Lenders' Mortgage Insurance you will generally require 20% equity. With serviceability (as stated before), 30% of your income and 70% of rents will count toward what you could afford to repay.
Good luck Goblin
Glenn