Can my parents use their house as guarantor for my home loan?

Potentially. Some lenders allow eligible parents to use equity in their property as security for part of their child's home loan, subject to lending criteria.

Can I buy a house with no deposit if my parents go guarantor?

Some lending structures may allow very high loan-to-value ratios with guarantor support, but requirements vary significantly between lenders. A guarantor also doesn't remove the need to demonstrate that you can service the loan or account for purchasing costs.

Does being a guarantor affect my parents' borrowing capacity?

It can. A guarantee may be considered when a guarantor applies for lending of their own, potentially affecting how much they can borrow.

Can my parents be removed as guarantors later?

Potentially. Once the borrower's lending position meets the lender's requirements without the additional security, it may be possible to apply to release the guarantee.

Is a guarantor home loan the same as giving my child a deposit?

No. A guarantor generally provides security to support the lending rather than simply transferring cash to the borrower.

Blog: What Is a Guarantor Home Loan and How Does It Work in Australia?

Q: What is a guarantor home loan?

A guarantor home loan involves another person—commonly a family member—providing additional security to support a borrower's home loan. The guarantor takes on financial responsibility under the terms of the guarantee if the borrower cannot meet their obligations.

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Thrive Financial Group

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