Saving a 20 percent deposit can take years, and with prices continuing to move, that wait can push homeownership further out of reach. For many first-home buyers, the deposit is the biggest hurdle.

Two popular ways around it are a guarantor home loan, where a family member backs your loan using the equity in their property, and the government’s 5 percent deposit scheme, which lets eligible buyers purchase with just 5 percent down (or 2 percent for single parents). Both can help you avoid Lenders Mortgage Insurance, but they work very differently. Before you decide, read our blog post on Guarantor loan or 5% deposit scheme to understand eligibility, citizenship rules, and location-based price caps.

The biggest difference is risk. With a guarantor loan, a family member’s property is tied to your debt, so they could be affected if you default. The government scheme does not require family assets as security, but the property you buy must be at or below the price cap. A guarantor loan offers more flexibility on price and location, while the scheme offers more independence.

Every buyer’s situation is different, so the best next step is a conversation about yours. Book a call now with our mortgage experts to compare both options and choose the safest, fastest route to your first home.