Family Home Guarantee for single parents explained

The Family Home Guarantee is an Australian Government scheme, administered by Housing Australia, that aims to help eligible single parents and single legal guardians buy a home with a smaller deposit and without paying Lenders Mortgage Insurance. Whether you qualify, and whether a smaller deposit suits you, depends on your circumstances and lender criteria.

This guide explains how the Family Home Guarantee works for single parents, who may qualify, what it could cost, and the steps to take. The general home loan figures here come from the Australian Securities and Investments Commission (ASIC) MoneySmart. Scheme rules, places, and eligibility change over time, so always confirm the current criteria with Housing Australia and your lender before you decide.

How the family home guarantee works

Most lenders look for a 20 percent deposit on the price of a property. A larger deposit lets you avoid Lenders Mortgage Insurance (LMI), which is a one-off fee that protects the lender, not you, if you cannot repay the loan. When your loan-to-value ratio (LVR) is above 80 percent, meaning your deposit is below 20 percent, LMI generally applies. For a fuller explanation, see What is lvr first home buyer.

The Family Home Guarantee changes this for eligible buyers. Under the scheme, the government guarantees part of the loan so an eligible single parent or single legal guardian can buy with a smaller deposit and avoid LMI. The scheme does not lend you money and it does not pay your deposit. It stands behind part of your loan so the lender does not require mortgage insurance. This is part of what makes it different from a standard low deposit loan, where some lenders may accept a deposit as little as 5 percent but LMI would normally still apply.

The single parent home loan scheme sits alongside other government support for first home buyers and buyers in regional areas. Each pathway has its own rules, so it is worth checking which one fits your situation. If you want to see how a low deposit path works more generally, see Buying with 5 percent deposit.

Who may qualify

Eligibility for the Family Home Guarantee is set by the scheme rules, not by Finance Lab. The scheme is aimed at single parents and single legal guardians with at least one dependent child. It is not limited to first home buyers, so a previous home owner who no longer owns property may be able to apply, depending on the current rules.

There is also a property price limit that varies by location, along with residency and citizenship requirements. This figure is reviewed and updated, so the current number matters more than any figure you may have read in the past. From 1 October 2025 the scheme removed its income test and its previous limit on the number of places released each year, so those no longer apply. For the confirmed thresholds that apply to you, check the Housing Australia website or speak with the team at Finance Lab.

Because the criteria change, the right move is to confirm the current rules and check your eligibility with a lender or broker before you make an offer. Whether you qualify depends on your circumstances and lender criteria.

What a smaller deposit could cost

A smaller deposit is not a smaller purchase. You still buy the same home, so a smaller deposit means you borrow more and your repayments may be higher than they would be with a 20 percent deposit on the same property. Avoiding LMI through the guarantee can save a real upfront cost, but the larger loan is the trade off. If you want to keep your LMI down where a guarantee does not apply, see How to avoid lmi.

You also still need to cover the upfront costs of buying on top of the deposit, like stamp duty and legal fees. First home buyer concessions may reduce or remove stamp duty in some cases, depending on where you buy and your circumstances.

Comparing lenders is worth the effort. Small differences in your mortgage interest rate can make a big difference to the long-term cost of your home loan, so it pays to look at more than one option. When you compare, look at loans from at least two different lenders and check the interest rates, fees, and features. The comparison rate is a single figure for the cost of a loan that includes the interest rate and most fees, which makes loans easier to compare. To see what your repayments might look like at different loan sizes, try the borrowing power calculator.

Steps to apply for the family home guarantee

You do not apply to the government directly. You apply through a participating lender, and the lender checks both your loan eligibility and the scheme criteria. A broker can help you find a lender that offers the guarantee and is a good fit for your situation.

Is the family home guarantee right for you

Buying sooner with a smaller deposit can help you enter the market without waiting years to save 20 percent, and avoiding LMI under the guarantee removes a real upfront cost. The trade off is a larger loan, larger repayments, and less equity at the start, which leaves a smaller buffer if property values move. There is no single right answer. Whether the scheme suits you depends on your circumstances, the property, and lender criteria, so it is worth talking it through before you commit.

Talk to the team at Finance Lab

If you want to know whether the Family Home Guarantee could work for you as a single parent, the team at Finance Lab can walk you through your options, check the current scheme criteria, and compare lenders for your situation. Get in touch and we will help you understand what may be possible.

Frequently asked questions