A new home with just 2% deposit? Amazing new government scheme

The Family Home Guarantee aims to support eligible single parents with at least one dependent child in purchasing a family home –  regardless of whether that single parent is a first home buyer or a previous home owner.

Ten thousand Family Home Guarantees will be made available over four financial years from 1 July 2021 to 30 June 2025.

Usually, first home buyers with less than a 20% deposit need to pay lenders mortgage insurance.

Under this Scheme, part of an eligible first home buyer’s home loan from a Participating Lender will be guaranteed by NHFIC. This is aimed at enabling you to purchase your first home sooner with as little as a 2% deposit.

Any guarantee of your home loan is for up to a maximum amount of 18% of the value of your property as assessed by your lender. This guarantee is not a cash payment or a deposit for your home loan.

View the Family Home Guarantee fact sheet

If your home loan is covered by this Scheme, you can also access other government programs – like the Australian Government’s First Home Super Saver Scheme, Home Builder Grant or First Home Owner Grant and concessions that may be offered by State and Territory governments. These other programs apply their own criteria and conditions, and you should make your own enquiries on their terms.

You will only be eligible to participate if you:

1. Are single. A person is considered to be single if they don’t have a spouse and/or the person does not have a de facto partner
2. Have at least one dependent child. To have a dependent child, you must be the natural or adoptive parent of the child and the child must either be
   • a “dependent child” within the meaning of subsections (2), (3), (4),(5), (6) and (7) of section 5 of the Social Security Act 1991 or
   • at least 16 but under 22 years of age, receive a disability support pension within the meaning of the Social Security Act 1991 and live with you.

Generally speaking, for the purposes of the Social Security Act 1991, this means that you must show that you are legally responsible (whether alone or jointly with another person) for the day-to-day care, welfare and development of the dependent child and the dependent child is in your care.

Family Home Guarantee applicants can be either first home buyers or previous owners who do not currently own a home.

To be eligible, you must not currently have:

• a freehold interest in real property in Australia
• a lease of land in Australia
• a company title interest in land in Australia

If you are unsure of your personal circumstances, you should ask a professional adviser.

For a property to be eligible under the Family Home Guarantee, it must be a residential property. This term has the same meaning as under the First Home Loan Deposit Scheme.

Eligible residential properties generally include:

• an existing house, townhouse or apartment
• a house and land package
• land and separate contract to build a home
• an off-the-plan apartment or townhouse

Use the postcode search tool to look up the property price caps for your location.

Contact a Participating Lender for the full list of property criteria and Scheme requirements, or if you are unsure what type of property you are buying.

Different timeframes can apply to your Scheme place, depending on the type of home you buy.

To be eligible for this Scheme, the contract of sale and (if applicable) eligible building contract may have particular dates when they can be signed by you. There are no exceptions from these required dates.

If you are purchasing an existing dwelling, the property must be purchased under a contract of sale dated on or after 1 July 2021