Advice for parents helping a first-time buyer.
If you are thinking about helping your children onto the property ladder, you may want to maintain an element of control, so you know your money will be secure.
Here are some great tips for parents who want to help their children purchase a property.
First you should make sure you do your research. If you can’t afford to buy a property outright, you’ll want to make sure you get the best mortgage deal for your children. Use an independent mortgage advice service and try to shop around.
If you are looking at a shared ownership property, make sure you are named on the deeds. If you have a stake in the property make sure you update your will accordingly. If you are named on the deeds, you may be liable for certain taxes on the property. You should seek professional advice regarding your potential tax liabilities on the property.
You should decide whether you are making a gift, a loan or an investment, use your knowledge of your children and their circumstances. You should speak to a professional, as well as you children and decide how best you can help them.
Contact a solicitor and get a legally binding contract drawn up that states the nature of your agreement, a verbal agreement will not safeguard a loan or investment.
Make sure you don’t put yourself in a risky financial situation by overextending yourself – your circumstances might change. You shouldn’t rely on your relationship with your children if things do go wrong.
Finally respect your children’s privacy and don’t decide who they can and can’t have at the property.
If you are thinking of becoming or helping someone to become a first-time buyer, we have a fantastic range of properties in the Coulsdon, Purley, Chipstead, Warlingham, South Croydon, Sanderstead, Caterham, Whyteleafe, Godstone, Woldingham, Oxted, Limpsfield, Three Bridges, Crawley and Pound Hill areas.
If you need property advice you can contact our offices directly.
You can view our range of properties here.