Family Home Guarantee to Support Separated Parents

Tuesday 06 Jul 2021

The transition between living in your family home and setting up two new separate lives, post-divorce, is complex and painful in almost every case. As the family navigates through the emotional trauma, solutions are put in place that solve immediate problems. 



But over the long term, more permanent decisions must be made. The financial toll of this can be significant, not just in the aftermath, but on your long-term financial goals as well. The immediate need is to find a place to live and if you're already paying all of the family's existing living expenses, adding a 2nd residence to that can be costly. Consider the most inexpensive option you have and work out how long you could use that as a solution. Moving into a small cheap studio by yourself and only seeing the children at the family home or in public places (parks, beach, movies etc) can be heart breaking but might make better financial sense in the short term. The biggest dilemma will be prioritising between the emotional needs of the children and the financial needs of the family.


It's important to remember that this period of rebuilding your life after divorce is hopefully only temporary. Giving yourself a year or two to focus on rebuilding will make better sense in the long run. Once you have the time frames clear you can also work out how much money you can realistically save during that time to put towards a property purchase in the future. For newly single parents, saving a deposit can be a real challenge, especially when capital post-divorce is so depleted.


Those who haven't owned property before will be relieved to learn the Federal Government has released an additional 30,000 places under their First Home Loan Deposit Scheme. First launched in 2019, with 10,000 places available, its goal was to support and enable first home buyers to buy a home sooner; specifically, those with at least 5% of a deposit saved. In addition, the New Home Guarantee program has also launched, with 10,000 places, to support first homeowners who want to build or purchase a new home with a deposit as low as 5 per cent. More specifically however, is support for single parents with dependent children, in the form of the Family Home Guarantee. Targeted at this group in particular (especially women), the scheme extends to both new and existing homes, isn't limited to first home buyers and requires prospective buyers to have just 2% of a deposit. This scheme also launched July 1st with 10,000 places available to eligible applicants.


The first step may be to invest small in something that solves a problem or has some potential to boost your savings. Over committing yourself in the midst of the fall out can be disastrous and you may never be able to get back in front again financially. The recovery period won't be easy but if you're patient and strategic, it can be revelatory. Try to make solid sensible decisions that provide solutions and help you on your way to rebuilding a brand-new future.