Experts say to set boundaries to maintain a healthy family dynamic.
An increasing number of to-be homeowners are borrowing from the bank of mum and dad as house prices fail to fall.
About 15 per cent of all borrowers were found to accept family help, with many unable to purchase a home without the financial boost, according to data from Jarden economists.Real estate agency BresicWhitney said the lending was no longer just for entry-level properties but also for family homes. "You will probably see it at every auction in the sub-$4 million price point," chief executive Thomas McGlynn said.With more people borrowing from their family, experts say it is important to establish boundaries from the start to maintain a healthy dynamic.
"It's really important to be clear just what the deal is here. Is it a gift, is it a loan, are you going guarantor," psychologist Peter Quarry said."If you're not , it can really lead to family problems, to conflict.""We definitely see instances when there's a divorce or separation and the funds that were advanced get intermingled and tied up in the marital asset pool," Justice Family Lawyers' Hayder Shkara said.
The advice for those tapping into the bank of mum and dad is to document the agreement in writing, clarify whether it is a gift or a loan, review your will and workshop "what-if" scenarios.
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