The real estate market can be tough for young adults, but as a parent you may be able to lend a
helping hand. We tell you how.
A parent-to-child loan is when a parent lends their child money. This is a formal, legally binding
arrangement, administered by an independent third party. At the start of the loan period, both
parties agree to terms including repayment amounts, a schedule and a process to manage
If your child doesn’t have enough security for a mortgage, you could provide a family guarantee.
This is where you use some of the equity in your own home as part of the security. For example,
your equity might cover 20% of the security, and your child’s new property would be the other
80%. It’s also known as a guarantor loan.
This can be a temporary arrangement until your child has paid down the loan to an acceptable
3.Becoming a co-applicant
You can help your child secure a loan if you sign on as a co-applicant. This means you’re equally
as responsible as your child for meeting repayments. The lender will consider your assets in its
When you give your child money but don’t expect it to be repaid, it’s considered a gift. You may
need to sign a statement to say it’s a gift, not a loan.
5.Assistance in kind
If you're risk averse, consider providing assistance in kind; that is, covering some of the expenses
that come along with buying a property. You could pay for services such as a property survey or
conveyancing fees, or help with stamp duty.
Make sure you're well informed about your options when giving or lending money so you can
remain in the best position to help your child become a home owner. You can contact your
mortgage broker to discuss the right financial arrangement for your family.
Phone: 0426 241 741 | 03 9372 7964
Head Office: 19 Napier Street Essendon VIC 3040
Brookline Finance Pty Ltd ATF The BF Business Trust is a credit representative (473836) of BLSSA Pty Ltd ACN 117 651 760 (Australian Credit Licence 391237)
Brookline Financial Services Pty Ltd is an Authorised Representative of Count Financial Ltd ABN 19 001 974 625 AFSL No. 227232 which is 85% owned by CountPlus Limited ABN 111 26 990 832 (CountPlus) of Level 8, 1 Chifley Square, Sydney 2000 NSW and 15% owned by Count Member Firm Pty Ltd ACN 633 983 490 of Level 8, 1 Chifley Square, Sydney 2000 NSW. CountPlus is listed on theAustralian Stock Exchange. Count Member Firm Pty Ltd is owned by Count Member Firm DT Pty Ltd ACN 633 956 073 which holds the assets under a discretionary trust for certain beneficiaries including potentially some corporate authorised representatives of Count Financial Ltd. The information on this web page is not advice and is intended to provide general information only. It does not take into account your individual needs, objectives or personal circumstances.