There are various ways parents can help their children buy a house:
- Buying a house outright for their child: This will depend on parents’ financial situation and the reasons for buying. It is important that parents consider their own financial wellbeing as well as their child’s.
- Gifting a deposit: Typically, first-time buyers will need at least a 10% deposit to purchase a property, which is difficult in today’s world. Most mortgage lenders will accept a gifted deposit, meaning parents will have no stake in their child’s home, but supporting documents and a Gifted Deposit Letter are required.
- Lending the money and charging interest, or being paid back when the property sells: If parents can’t afford to give their children a large sum of money, they can arrange a repayment plan with terms.