Buying without a large deposit?


Guarantor loans could be the solution to get you into the property market. Guarantor loans work by providing additional security (usually home equity) from a third party – often a family member. The guarantor isn't required to make any payments on your loan. But if you can no longer keep up your repayments, the lender will turn to the guarantor to make the repayments. In this way, it’s possible to get a home loan even when you have a small deposit.

Many lenders allow a family member to help you to buy your own home by providing additional security. The person providing this assistance is known as a guarantor. This is different from being a co-applicant or co-signer.

A co-applicant is included on the loan and will be responsible for the entire loan until it's repaid in full.

A guarantor, on the other hand, is linked to a loan by a guarantee. This guarantee can be released and the guarantor’s responsibility stopped without the loan being repaid in full. To use a guarantor, you must be able to service the entire loan on your income. 

Understanding guarantors guide

Click HERE to download our Understanding Guarantors Guide

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