A family guarantee uses your parents’ equity instead of a cash deposit, usually with no lenders mortgage insurance, and it can be released once your loan is under about 80 per cent, if the lender approves. Free 30-minute call, no obligation.
Yes. Your parents pledge a fixed, written slice of equity in their home, usually the gap between your savings and a 20 per cent deposit plus costs; no cash changes hands, and they pay only if you default.
Because the lender then holds security over the full 20 per cent, mortgage insurance usually falls away, which can save tens of thousands of dollars.
The guarantee can be released once your loan falls to about 80 per cent of the property value, when you apply and the lender approves, usually after a fresh valuation.
Part of the first home buyer loans guide.
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Quick guarantor check
Two sliders. See what your parents would need to guarantee.
How a parent’s equity can stand in for the deposit, often with no LMI.
With a family guarantee covering that portion, you could potentially buy with your $30,000 and no LMI. Costs assume NSW first home buyer duty.
Limited to this portion, secured against the guarantor’s property, released once you reach 20% equity, subject to lender approval. Indicative only, not credit advice.
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Buyers and parents who have worked with Charles.
Charles Touma from Links Property Finance was a great help with buying my first home. I had plenty of questions and he took the time to explain things clearly without making me feel rushed. He kept me updated throughout and made the process much less stressful. Really appreciated his patience and would happily recommend him to other first home buyers.
I have had a number of dealings with Charles from Links Property Finance. He is very knowledgeable, thorough, and detailed with his advice. Importantly, he is very approachable and easy to deal with. His advice has been beneficial to myself and my acquaintances. I highly recommend him.
Charles and the team recently assisted us with a refinance of our investment property. Recommend Charles and the team to all
Bring your parents to the call. One conversation covers the amount, the risk and how it comes off.
No documents needed. No credit check. About a 30-minute conversation, and Charles calls within one business day.
Prefer a family call at a set time? Book a 30-minute call
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Charles went above and beyond to help us secure our home loan. He worked hard to find the best option for us and kept us updated throughout the whole process. His knowledge of the lending market was impressive and he made everything straightforward.
Two sliders. Most lenders work to about 80 per cent of the property’s value, less whatever is still owed.
Comfortably covers the $133,500 guarantee from the calculator above.
Indicative only. Each lender sets its own cap and assesses the guarantor’s position; retired guarantors face extra conditions.
Charles Touma, Mortgage Broker.
Enough usable equity to cover the guaranteed slice, usually the gap between your deposit and 20 per cent of the price plus costs. The guarantor calculator shows the slice for your price.
Lenders measure it at 80 per cent of the guarantor home’s value less any loan still on it, and most want the guarantor’s own home, not an investment property.
Only the guaranteed amount. If you default and the sale of your home falls short, the lender can claim the shortfall from your parents up to that written figure, never the whole loan.
Most lenders require the guarantor to take independent legal advice before signing, and the guarantee can be released, on application and with the lender’s approval, once the loan reaches the lender’s equity threshold.
Neither in general; they are different tools. The scheme needs no family help but caps Sydney purchases at $1.5 million and requires an eligible first home buyer, while a guarantee has no price cap, suits second homes and upgraders, and can cover costs as well as the deposit.
Some buyers use both: the scheme first, then a guarantee that can be released once the loan is under about 80 per cent, with lender approval.
Yes. A parent can borrow and own with you, which brings both incomes into the assessment but puts the parent on the loan and the title. Joint mortgages with your parents explains the rules, and buying with no deposit compares every route.
In NSW a first home buyer who owns at least half keeps first home buyer duty relief on their share, and the parent pays duty on theirs.
Yes. Most lenders release the guarantee once your loan falls below 80 per cent of the property value through repayments, growth or both. A new valuation is usually required.
Many guarantees are released within three to five years, though timing depends on the market and your repayments.
No. A family guarantee usually takes the loan to value ratio on your purchase to 80 per cent or below, which removes lenders mortgage insurance.
That saving is often the main reason to use a guarantee, alongside buying sooner without waiting to save a full deposit.
No. Their equity backs a set portion of your loan and nothing leaves their account. You borrow the full amount in your own name, own the home outright from day one and make every repayment. The guarantee is a legal obligation, not a transfer of cash.
No. A guarantee replaces the deposit, not your income. The lender still assesses your capacity to service the whole loan at a buffered rate, and the guarantor’s income is not counted.
If servicing is the problem, the answer is a cheaper property or a longer saving period, not a bigger guarantee.
Usually, yes. The lender looks at the equity left after their own loan: most work to about 80 per cent of their home’s value less what they still owe.
Their lender may need to consent if the guarantee sits with a different bank, so the two loans are often placed with the same lender.
Usually, yes. Most lenders require the guarantor to see an independent solicitor before signing, so the risks and the limited amount are explained to them by someone acting only for them. Links organises the lender’s documents and times the appointment so the advice does not delay settlement.
Sometimes. The NSW stamp duty exemption looks at the buyer and the price, so it applies regardless of a guarantee.
The 5% Deposit Scheme and a family guarantee are both ways of covering the gap to 20 per cent, so lenders generally use one or the other, not both at once.
A guarantee works best when everyone understands it before anyone signs. Thirty minutes covers the amount, the risk, and how it comes off.
Three recorded Links files. Identities removed, figures rounded as recorded.
Have Charles check your guarantor options
General information only, not credit or financial advice. Lender policies and government scheme criteria differ and change over time. All lending is subject to individual assessment and approval.
Official sources for the figures on this page: Housing Australia, Australian Government 5% Deposit Scheme. Scheme rules change; the official pages are the final word. Checked against these sources on 12 October 2026.
