Family Home Guarantee

Family Home Guarantee: the 2% deposit loans scheme for single parents

The Family Home Guarantee is a Government benefit created to support single parents with at least one dependent child, who intend to buy a house in Australia.

If you want to learn more about this benefit, in this article we will explain how it works, who is eligible to apply and many other specificities you need to know to understand whether or not you are able to apply.


What is the Family Home Guarantee?


The Family Home Guarantee allows single parents, including divorced individuals, to buy a property with only a 2% deposit, without paying any insurance. Usually, lenders require home buyers with less than a 20% deposit to pay the LMI (lenders mortgage insurance) to minimize the risk of lending money to someone with little savings.

Under the Family Home Guarantee scheme, the insurance is secured by The National Housing Finance and Investment Corporation (NHFIC). This means your initial investment will be much lower, enabling you to purchase a home much sooner. 

Just to give you an example:

If you are buying a house worth $500,000, the deposit required under this grant will be only $10,000.

Even so, it is important to highlight that the Family Home Guarantee won’t give you money, increase your income or make it easier to be approved for a loan, which means you still need to go through the whole process of being approved for a home loan and provide solid proof of income.

If you are a single parent and your income comes mainly from government concessions or other benefits, you still qualify for the Family Home Guarantee, however, the chances of being approved for a mortgage, in this case, are lower.


Who is eligible for the Family Home Guarantee?


Unfortunately, this benefit only applies to Australian citizens, so this won’t work if you are a permanent resident. Other requirements include being single or divorced and having at least one dependent child.

Besides that, there is also a máximum income cap of $125,000 per year. So, if you are a single parent and your salary is higher than that, you won’t be eligible for the grant. 

Caution: this income limit doesn’t mean you won’t be able to buy any property or apply for any other Government grant. You sure can still do that! The limit applies specifically to the family home guarantee grant.


What kind of property can I buy with the Family Home Guarantee?


Even though other government benefits, such as the First Time Home Owners Grant (FHOG) are only available for buying or building a new house for the first time and living there, the family home Guarantee is different.

This scheme includes both new and existing homes, as well as the ones yet to be built, and it is not restricted for first time home buyers. If you already purchased a home before, you can still buy a property under this grant.

However, it is limited to owner-occupied homes, which means you can not buy an investment property under the Family Home Guarantee.


Property prices cap per state


Each state has their own rules when it comes to the property prices cap, and this can even change according to the city you are buying. So we put together a list with the main States we usually work with to give you a better scenario:


In main cities, such as Sydney, New Castle, Wollongong and etc:
up to $800,000

Regional cities:
up to $600,000


Main cities like Brisbane or Gold Coast:
up to $600,000

Regional cities:
up to $450,000


Main cities:
up to $700,000

Regional cities:
up to $500,000


up to $500,000

Regional cities:
up to $350,000

It has already been announced that there will only be 10,000 grants available by the end of the 2025 financial year. We don’t know yet how these places will be distributed, but we believe it will be 2,500 per year. 

So, if you fall under the criteria mentioned in this blog post or if you know someone who is a single parent and might benefit from the Family Home Guarantee, please contact us or share this post with them.

We will be more than happy to guide you through this journey! We are Mortgage Brokers based in Sydney, but we also assist clients all around Australia in both languages, English and Portuguese.

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