Also known as a guarantor home loan, a family equity loan allows a ‘guarantor’ (usually a family member) to offer the equity in their own property as additional security against your loan if you have a smaller deposit than the expected amount for your home loan.
Even though your deposit is smaller, you may not have to pay lenders mortgage insurance (LMI) with a guarantor home loan. However, iIf you are unable to make repayments, your guarantor will be held liable for the loan and have to make the missed repayments on your behalf.
