Single Parent Family Home Guarantee

Single Parent Family Home Guarantee

The Single Parent 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.

10,000 Family Home Guarantees will be made available over four financial years from 1 July 2021 to 30 June 2025.

1. Which government is providing this guarantee

The federal government has launched an initiative to allow single parents to take out a home loan deposit with as little as 2% (subject to being able to service home loan repayments). 

The Family Home Guarantee program is administered by the National Housing Finance and Investment Corporation (NHFIC) on behalf of the Australian Government.

2. Who is it for

Single parents using the Family home guarantee scheme are generally defined as:

  • Without a spouse or a de facto partner

  • have at least one dependent child, i.e. must be the natural or adoptive parent of the child 

Generally speaking, 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.

3. How to Apply

Eligible single parents will be able to apply for the Family Home Guarantee through a First Home Loan Deposit Scheme (FHLDS).

There are no costs or repayments associated with the guarantee. However, eligible single parents are responsible for meeting all costs and repayments for the home loan associated with the guarantee. 

NHFIC will not accept applications directly and does not maintain a waiting list for Family Home Guarantee places. 

4. Eligibility Criteria

Australian citizens who are at least 18 years of age. Permanent residents are not eligible. 

  • Must be a single parent with at least one dependent child. 

  • The single parent must have a taxable income that does not exceed $125,000 per annum for the previous financial year. NB: Child support payments are not included as income for the income cap. 

  • The single parent must be the only name listed on the loan and the certificate of title. 

    • It is expected that the single parent demonstrates that they are the natural or adoptive parent of a dependent child 

    • Alternatively, the single parent must show that they are the natural or adoptive parent of a child between 16 and 22 years of age, who receives a disability support pension and lives with them. 

  • Individuals must have at least 2 percent of the value of the property available as a deposit. If the borrower has a deposit of more than 20 percent, then the home loan cannot be covered by the Family Home Guarantee.

  • Loans under the Family Home Guarantee require scheduled repayments of the principal and interest of the loan for the full period of the agreement. The loan agreement must have a term of no more than 30years. 

  • Applicants must intend to be owner-occupiers of the purchased property. In the case of an active Australian Defence Force member applicant, the guarantee is not subject to the owner-occupier requirement after entering into the loan if they cannot meet this requirement because of their duties. 

  • Applicants can be either first home buyers or previous owners who do not currently own a home. That is, the applicant must not currently have a freehold interest in real property in Australia, a lease of land in Australia or a company title interest in land in Australia.

  • The eligibility criteria must be satisfied at the time the loan agreement is entered into. The eligibility criteria for the Family Home Guarantee is outlined in the currently in force National Housing Finance and Investment Corporation Investment Mandate Direction 2018. 

5. Other

NHFIC guarantee is not a cash payment or a deposit for your home loan.

NHFIC does not administer stamp duty and cannot grant any waivers of it, relevant state or territory authorities need to be contacted.

If you receive payment from Centrelink, depending on your personal circumstances, the nature of the payment you receive and whether your income exceeds the limits for the Scheme. 

There are property thresholds that apply. These are the same as those applying to the First Home Loan Deposit Scheme. See summary table below.

For the territories of Jervis Bay Territory, Norfolk Island, Christmas Island and the Cocos (Keeling) Islands, the relevant price cap is the same as the rest of state cap that applies in the closest State – New South Wales (for Jervis Bay Territory and Norfolk Island) and Western Australia (for Christmas Island and the Cocos (Keeling) Islands). 

Property price thresholds also apply for specific suburbs or postcodes. 

Given the number of Participating lenders and their own specific requirements for accessing the scheme, we can help clients navigate the process by assessing the most suitable lender for your needs and circumstances.

Book a hassle free consultation today to get started.


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