Parents helping their kids purchase their first home
Updated: May 16, 2019
Parents play an important role in helping support and nurture their children to be successful as adults in what is a challenging world. When it comes to the purchase of a first home, parents can make the difference when it comes to their children and the success they have in purchasing a first home. Here are the ways that parents can make a positive impact:
Setting the Goal
Helping your kids by establishing buying a first home as a priority is one of the earliest and important aspects influencing the success of your children’s first home purchase. Often it can be a goal that is seems to big or too difficult, but helping your children establish a first home purchase a realistic and achievable goal is the start they need to make a first home purchase a reality.
Budget and Financial Organisation
One of the more important ways parents can help their kids increase their chances of purchasing a first home is to ensure their kids have sound financial fundamentals around financial organisation, budgeting and cashflow management and establishing and working towards key financial goals. Our referral partners can assist your family using the latest in financial technology to make financial organisation easier and more effective.
Providing a Gift
A deposit can be one of the biggest challenges for first home buyers to secure and often the financial costs of living expenses, university expenses and social expenses can make it difficult for young adults to save. By giving your kids a gift for their deposit, it can bridge the gap between what your kids can borrow and what they need to settle.
Providing Equity as a deposit
For parents without the spare funds to provide gift, there is an alternative in providing part of the equity in their home as collateral for their kids first home purchase. A number of lenders offer “Family Equity” loans where the required ‘deposit’ is guaranteed by the equity in a parents home. This has become more popular in recent times presenting the assistance and flexibility for parents to help their children without needing to come up with the funds for a deposit.