A guarantor loan allows someone (often a family member or parent) to pledge their assets to support a borrower's home loan application. This video explains how guarantor loans work, when they're useful, and what both the borrower and guarantor need to understand before entering this arrangement.

Guarantor loans explained:

• What a guarantor means legally and financially

• How guarantor loans help borrowers access property market entry

• Risks for the guarantor if the borrower defaults on the loan

• Alternatives to guarantor arrangements

Guarantor loans can be a practical solution for young borrowers or those without a large deposit, but both parties need to understand the commitment and risks involved. An arrangement that makes sense at the start might create problems later if circumstances change.

Explore our finance services to understand whether a guarantor loan suits your situation.

Video details:

0:00 Intro

1:09 How does a family guarantor work?

1:40 Starting the conversation

2:00 What to discuss with family

2:46 Having insurance in place

3:00 Risk for parents