“The guarantee remains until your LVR reaches 80%. This is typically achieved in 3 to 7 years through repayments and growth.”
The length of time a guarantor remains on your loan is not set in advance — it depends on when your LVR falls below 80%, which is the standard threshold for guarantee release across most lenders.
How the LVR calculation works
Your LVR is your outstanding loan balance divided by your property’s current value. As you make repayments, your balance falls. If your property grows in value, the denominator rises. Both movements push your LVR lower. When it reaches 80%, you can formally apply to your lender to release the guarantee.
Typical timeline
For a buyer who enters with a 5% deposit through a family guarantee, reaching 80% LVR typically requires 3–5 years of standard repayments in a stable or growing market, or 2–4 years if extra repayments are made. In a market where property values increase meaningfully in the first few years, the timeline can be shorter — sometimes under 2 years.
How to accelerate release
Making extra repayments reduces the loan balance faster. Requesting a formal lender valuation when you believe the property has increased in value can trigger release without waiting for principal repayments alone to close the gap. A valuation showing the property has risen 15% from purchase may take years off the guarantee period.
What if release takes longer than expected
If your property market is flat or declining and repayments alone are slow to close the gap, the guarantee stays in place. Your parents cannot be released unilaterally — the lender must confirm the 80% LVR threshold is met. If your parents need to sell or refinance their property while the guarantee is active, a formal release may need to be negotiated with the lender.
→ You may wish to speak with a licensed mortgage broker to assess your personal circumstances. This is general information only. Individual circumstances vary and scheme details change regularly. Verify current eligibility, caps, and terms with official sources before making decisions. Speak with a licensed mortgage broker for advice tailored to your situation. All loans are subject to lender approval.
Sources: ASIC MoneySmart, Guarantor Home Loans 2025; National Consumer Credit Protection Act 2009; CoreLogic, Melbourne Dwelling Values May 2026.
