Last Updated: 31st October, 2023

Since 2021-22, the Australian Government has facilitated a scheme called the Family Home Guarantee.

The Family Home Guarantee is available through 30 June 2025.

There were initially 10,000 total places under the scheme. As of 1 July 2022, the government is adding 5,000 additional cases a year.

What Is The Family Home Guarantee?

Under the scheme, a single parent with dependants can build a new home or purchase an existing one with as little as 2% of the property value, without paying Lenders Mortgage Insurance (LMI).

LMI is often charged on deposits of less than 20%. In this scheme, if the borrower pays a 2% deposit, the government will guarantee 18% of the loan, allowing the borrower to avoid paying LMI.

Comparison between the family home guarantee and first home guarantee scheme in terms of deposit, government guarantee and home loan

Home Guarantee Scheme Expands Eligibility For 2023-24

The federal government has announced changes to the Home Guarantee Scheme. The changes will greatly expand the number of people eligible to participate in the scheme. From 1 July 2023:

  • Friends, siblings and other groups of family members can jointly apply for the First Home Guarantee and Regional First Home Buyer Guarantee.
  • Non-first-home buyers who have not owned property during the last 10 years can also apply.
  • Borrowers who are single legal guardians of children – such as their aunts, uncles and grandparents – can apply for the Family Home Guarantee.
  • Australian permanent residents are eligible to apply for all three schemes: First Home Guarantee, Regional First Home Guarantee and Family Home Guarantee.

With the expansion of the eligibility criteria, owning a home could be within reach for many more buyers. To find out if you can apply, call us on 1300 889 743 or complete our free assessment form today.

50,000 Places From 1 July 2022

Beginning in financial year 2022-23, the government will provide a total of 50,000 places each year under the various schemes:

  • 35,000 total places a year under the First Home Guarantee; this is an increase from the 10,000 currently available
  • 5,000 additional places a year under the Family Home Guarantee, from 1 July 2022 to 30 June 2025

What Are The Eligibility Requirements?

The Family Home Guarantee is for single parents with dependants.

The government estimates that around 125,000 single parents are eligible, with 84% of them being single mothers.

Requirements Eligibility criteria
Age 18 years or older
Income Your taxable income must not exceed $125,000
Child support payments are not included in the income cap.
Ownership The scheme is not limited to first-home buyers. You can be a previous home owner.
You can’t currently own a property.
Citizenship Applicants must be Australian citizens and 18 years or older
Permanent residents are not eligible.
Deposit A minimum deposit of 2% of the property value is required.
If the deposit is 20% or more, you will are not eligible for the scheme
Type of housing Build a new home OR Purchase an existing home

  • Existing house
  • Townhouse
  • Apartment
  • House and land package
  • Land and separate contract to build your home

What Are The Price Caps For The Scheme?

Region FY 2021-22 FY 2022-23
NSW – Sydney & regional centres
(Newcastle, Lake Macquarie & Illawarra)
$800,000 $900,000
NSW – rest of state $600,000 $750,000
VIC – Melbourne & regional centre
$700,000 $800,000
VIC – rest of state $500,000 $650,000
QLD – Brisbane & regional centres
(Gold Coast & Sunshine Coast)
$600,000 $700,000
QLD – rest of state $450,000 $550,000
WA – Perth $500,000 $600,000
WA – rest of state $400,000 $450,000
SA – Adelaide $500,000 $600,000
SA – rest of state $350,000 $450,000
TAS – Hobart $500,000 $600,000
TAS – rest of state $400,000 $450,000
ACT $500,000 $750,000
Northern Territory $500,000 $600,000

Where are the regional centres?

The regional centres apply to cities with a population over 250,000:

  • Newcastle & Lake Macquarie
  • Illawarra (Wollongong)
  • Geelong
  • Gold Coast
  • Sunshine Coast

What Are The Price Caps For Territories?

Territory FY 2021-22 FY 2022-23
Jervis Bay Territory
Norfolk Island
$550,000 $550,000
Christmas Island and Cocos (Keeling) Islands $400,000 $400,000

How Do I Apply?

You will need to apply through a participating lender.

The National Housing Finance and Investment Corporation (NHFIC) does not accept applications and does not maintain a waiting list for scheme places.

Once you apply, your lender will tell you if you were successful in reserving a place for the Family Home Guarantee

What Is The Process To Reserve A Place?

You will go through the following process to reserve a place in the Family Home Guarantee:

Step 1: Initial home loan application

You apply for a home loan with a participating lender to make a First Home Guarantee reservation. It will take 14 days for the lender to assess your financial situation.

Step 2: Get pre-approval for a home loan

Once the lender gives you a home loan pre-approval, the reservation can be extended for a further 90 days. During this time, you have to find and sign a contract of sale for an eligible property.

Step 3: Sign contract of sale

Once you sign the contract of sale, your reservation can be extended for 30 days from the signing date.

The additional period is for you and your lender to finalise the paperwork and checks for your home loan.

To ensure the extension applies, make sure you immediately inform your lender that you’ve signed the contract of sale, so your lender can notify the NHFIC.

If you cannot finalise your home loan during this period, your reservation will expire.

Which Lenders Are Participating?

NAB, CBA and Westpac are the three major banks participating in the Family Home Guarantee Scheme.

The non-major lenders are:

  • Australian Military Bank
  • Auswide Bank
  • BankSA
  • Bank Australia
  • Bank First
  • Bank of Melbourne
  • Bank of us
  • Bendigo Bank
  • Beyond Bank Australia
  • Community First Credit Union
  • CUA
  • Defence Bank
  • Gateway Bank
  • G&C Mutual Bank
  • Indigenous Business Australia
  • Mortgageport
  • MyState Bank
  • People’s Choice Credit Union
  • Police Bank (including the Border Bank and Bank of Heritage Isle)
  • P&N Bank
  • Queensland Country Credit Union
  • RAMS
  • Regional Australia Bank
  • St.George
  • Sydney Mutual Bank and Endeavour Mutual Bank (divisions of Australian Mutual Bank Ltd)
  • Teachers Mutual Bank Limited (including Firefighters Mutual Bank, Health Professionals Bank, Teachers Mutual Bank and UniBank)
  • The Mutual Bank
  • WAW Credit Union

View more

FAQs: Family Home Guarantee

Should I apply for the scheme?

The Family Home Guarantee is aimed at single parents who want to buy a property sooner without paying LMI.The biggest benefit is the thousands of dollars saved by avoiding LMI, since the government is acting as a guarantor and backing the borrower.

However, the scheme has some disadvantages:

  • You’ll be borrowing more; the bigger the loan, the more you’ll be affected when interest rates rise.
  • You will have a high loan-to-value ratio (LVR), which makes falling into negative equity (when your loan amount is higher than property value) more likely.
  • Repayments can be higher when you’re borrowing with a higher LVR.
  • Only a small fraction of single parents satisfy the strict eligibility criteria.
  • You will need to build a strong case as a single borrower. You should have a clean credit file with few or no blemishes and stable employment.
  • As you’re the sole applicant, you’re depending on a single income to service the loan. Having dependants affects your borrowing power.
  • Traditionally, lenders prefer single parents with mostly PAYG income. Payments from Centrelink might not be accepted.
  • There are other costs associated with buying property that the deposit does not cover, such as stamp duty and mortgage fees.

We’re here to help

Home Loan Experts can help you lodge an application for the Family Home Guarantee.

We have other options available if you don’t qualify for the scheme:

Discuss your situation with our mortgage brokers today, and we’ll find you the best home loan for your scenario. Call us on 1300 889 743 or fill in our free assessment form.