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Home Answers What is the First Home Guarantee? | Lendology Adelaide
Plain-English answer

What is the First Home Guarantee?

The direct answer
The First Home Guarantee is a federal government scheme that allows eligible first home buyers to purchase a property with a 5% deposit, with the government guaranteeing 15% of the loan value. This eliminates the need for Lenders Mortgage Insurance (LMI). As of 1 October 2025, there are no income caps and no limit on places. The SA price cap is $900,000 for Adelaide and regional centres. Source: Housing Australia.

Who is eligible for the First Home Guarantee?

To be eligible you must: be a first home buyer; be an Australian citizen or permanent resident; intend to occupy the property as your principal residence; and purchase within the applicable price cap ($900,000 for Adelaide and SA regional centres as of 2026).

As of 1 October 2025, income caps have been removed and there is no limit on the number of places available. Both new and established homes are eligible. Source: Housing Australia.


How does the guarantee work?

The government does not pay any money upfront — it guarantees 15% of the loan value to the lender. This means the lender treats your loan as if you had a 20% deposit (5% your own savings + 15% government guarantee), which is why LMI is not required.

You still borrow 95% of the property value and repay the full loan amount over time. The guarantee simply removes the LMI requirement — it does not reduce the loan amount or interest payable.


How do I apply for the First Home Guarantee?

You cannot apply directly to Housing Australia — applications must be made through a participating lender. Not all lenders participate, and not all participating lenders offer the same rates and products. Lendology identifies the most competitive participating lender for your situation and manages the application as part of your loan process.


Common questions

Frequently asked questions

Is the First Home Guarantee available for established homes?
Yes — the First Home Guarantee is available for both new and established homes, subject to the price cap. This is different from the SA First Home Owner Grant, which is only available for new builds.
What is the price cap for the First Home Guarantee in Adelaide?
The SA price cap is $900,000 for Adelaide and regional centres as of 2026. Source: Housing Australia.
Can I use the First Home Guarantee with the SA First Home Owner Grant?
Yes — eligible buyers purchasing a new home in SA can access both the First Home Guarantee (federal) and the $15,000 SA First Home Owner Grant simultaneously. Lendology coordinates both applications as part of your loan process.
What happens to the guarantee when I sell the property?
The government guarantee ends when the loan is discharged — typically when you sell the property or refinance. At that point, normal LMI rules apply if your equity is still below 20%.
Sources: Housing Australia (housingaustralia.gov.au/support-buy-home/first-home-guarantee)

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The information on this page is general in nature and does not constitute financial advice. Given Finance Pty Ltd (t/a Lendology) ACN 624 144 501 is authorised under LMG Broker Services Pty Ltd ACL 517192.