A guarantor mortgage lets you buy a home with someone else backing your application. Your guarantor agrees to step in and cover your mortgage payments if you can’t keep up with them. The guarantor won’t own the property. But they will be on the hook if things go wrong – so it’s a big commitment for them.
It depends on the lender, but there are two main types:
1. Savings-backed: Your guarantor puts a lump sum (usually 5–10% of the property price) into a savings account linked to your mortgage. It stays there for a few years as security typically 3 to 5 years as long as you keep up repayments.
2. Equity-backed: Your guarantor uses equity in their own home as security. If you default, the lender could claim against that equity.
Usually a close relative, most commonly a parent. But in some cases, lenders may allow other family members or close friends.
To be a guarantor, you’ll typically need:
✅ Get on the ladder sooner
✅ Borrow more
✅ No need to share ownership
⚠️ Risk to your guarantor
⚠️ Limited lenders
⚠️ Ties that bind
A guarantor mortgage is different from a joint borrower sole proprietor (JBSP) mortgage:
Some guarantor mortgages allow 100% borrowing meaning no deposit at all if the guarantor provides savings or equity. Others may still require a small deposit (around 5%).
Yes – often after a few years, once:
Because the guarantor isn’t listed as a co-owner, they don’t pay stamp duty on the property, even if they already own one.
It could be a great option if:
At Habito, we’re all about making homeownership easier. Whether it’s a guarantor mortgage or something else entirely, our brokers can help you find the right fit for free.
Frequently asked questions
Zero deposit? No problem. Here's how 100% mortgages work, who they’re for, and the risks and rewards of buying a home with no upfront savings.
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