Here's what you need to know about helping your child buy a house.
These plans could allow you to take cash from the value of your home, without having to move out. If you own your property outright or if your property's worth more than any loans you have secured against it, then you've more than likely got equity tied up in your home.
How can I help my child buy a home?
- A financial gift
- A loan
- Putting your savings in a linked account
- Acting as a guarantor on a mortgage
- Getting a joint mortgage
The solicitor working on the property purchase can draw up a declaration of trust. This states who the money was gifted to - so you can specify you gave it to your child and not to them and their partner. If the couple break up this document will ensure your child retains ownership of your financial gift. It can also clarify if the money is a gift or a loan, and if the latter when it needs to be paid back.
The people buying the property can also use a deed of trust to lay out responsibilities for outgoings and what happens to the property if their relationship breaks down.
While we are talking about the legal side of gifting money you should also consider updating your will to reflect the gift that has been made. Children may also want to write a will to ensure the gifted money goes back to their parents if they die.
The process of buying a house for your child
Let us help you secure your child's first home
The choice of interest rate and product terms will depend on your circumstances and the amount of the mortgage. Before you make a mortgage application, we will carry out a full review to establish your needs and preferences and if you meet the criteria, we will give advice and make a recommendation to you. There may be a fee for mortgage advice. All mortgages are subject to status. Please note that all products show an indicative rate only and may not be suitable for you. You must be 18 or over.
Your home may be repossessed if you do not keep up with mortgage payments.