What is Guarantor Loan?
A guarantor loan is one where a family member — typically a parent — uses the equity in their property as additional security for your loan. This lets you buy with a smaller deposit (sometimes zero) and avoid LMI.
Why it matters for you
Guarantor arrangements work best when the guarantor's share is limited to a defined amount (e.g. 20% of your loan) rather than the full loan, and released after you build sufficient equity. The guarantor's property is exposed if you default — so structure and exit strategy matter.
Last updated: April 2026