Did you know that from 1 October 2025, the Government’s Home Guarantee Scheme got a major boost to help more Australians into their first home.

What’s new?

• Unlimited places: no cap on the number of guarantees available.
• No income caps: higher-income earners can now apply.
• Higher property price caps: better aligned with today’s market.
• Simpler regional access: one streamlined First Home Guarantee.

This means first home buyers can purchase with as little as a 5% deposit and avoid Lenders Mortgage Insurance.

But with house prices soaring and high interest rates adding some challenges, saving a hefty deposit while covering rent can feel like a big hurdle. 

Thankfully, there’s a solution that may help your children get into their first home: a guarantor loan!

How you could help your children buy their first home with a guarantor loan

How does it work? It’s usually straightforward. 

A guarantor (often a parent) uses the equity in their property as extra security for your child’s home loan, usually enough to bring the loan-to-value ratio (LVR) down to 80%.

The primary security is your child’s new home, but the lender also takes a mortgage on the guarantor’s property for added assurance.

Great news: the guarantor doesn’t need to make any loan payments.

Your children must show they can manage the full loan repayments based on their income.

Once they’ve built up equity in their home (through repayments or property value growth), the guarantor can request to be released. 

The timeline depends on the initial deposit, extra repayments, and market trends.

Who can be a guarantor?

Typically, it’s immediate family members like parents, but some lenders allow siblings or grandparents to step in. It varies, but Astute can assist with lender specifics. 

What’s the guarantor’s responsibility?

Being a guarantor is a wonderful way to support your children, but it comes with some responsibility. 

If they can’t meet repayments, the lender may pursue action against them and, in rare cases, the guarantor could be responsible for the guaranteed amount. 

It’s a commitment worth understanding fully.

Seek expert guidance

Considering being a guarantor? It’s smart to consult an independent legal and financial adviser first to ensure it’s the right fit. 

Most lenders require this step anyway, so it’s a perfect chance to get all the details.

One of Astute’s team can help you understand whether using a guarantor or offering to be a guarantor will work for your circumstances.

Let’s get started

The team at Astute are here to help people into their first home. 

With options such as a guarantor loan and the assistance of the First Home Guarantee, we can help.

Please note - this is paid content