Page 191 - Australian House & Garden (January 2020)

B RAND P R O M OTI O N

Helpinghand

If you’re in a position to be able to help

your children with their first house purchase,

there’s a few things to consider upfront.

hether it’s going guarantor

on their home loan, or offering
Wrent-free living, helping our
adult children to buy property has become
more common in recent years, particularly
with escalating city property prices and

stagnant wage growth.
As a fi nance expert and mother herself,
Dimitra Dinos, General Manager Home
Loans at the Commonwealth Bank,

completely understands why parents
would want to help children get a foot
on the property ladder but emphasises
that there are a few considerations
everyone should think about fi rst.
“For example, be realistic about your

kids’ fi nancial track record and ability to
repay a home loan. It’s also imperative that fi nd it challenging to save a deposit, towards their fi rst home, which can be
you consider your own circumstances and providing them with a fi nancial payment just as valuable in the long term.
ensure that you are able to assist without (that can be used as the home deposit) “For instance, many parents with adult

impacting your own fi nancial wellbeing. could be a big helping hand. Depending kids may have extra space in the family
While you might be in a position to help on your preference, this can be provided home. If you have the room, you could
today, you need to also consider your as a gift or as a loan. allow them to move in for a set period
future circumstances; both planned, such For parents who don’t have a lump to help them save for a deposit. Just
as retirement; and the unplanned ‘what if’ sum of cash available, an alternative remember that this could have an impact

moments such as changes in your health, option is to become a guarantor on on your bills and living expenses, so make
relationship, or career,” she says. the child’s home loan. sure this is something you can sustain
And while it’s emotionally compelling “It’s important to fully understand the or ask them to contribute to the bills,”
to want to lend a hand to your children, pros and cons of becoming a guarantor recommends Dinos.

it helps to seek another objective (and as there are some risks. For example, as Find out more about buying property
emotionally detached) opinion. a guarantor you will be responsible for at commbank.com.au/home-buying
“It’s incredibly important that you repaying the debt if your child is unable
seek independent legal and fi nancial to meet their mortgage repayments,”
STORY advice before committing to anything,” says Dinos.

BY she recommends. THE BIG PICTURE
PRODUCED MAIN WAYS TO HELP If you don’t feel comfortable giving a
fi nancial gift, have complex or large family
There are two main ways parents can assist
their kids to buy property. If your kids can
afford monthly mortgage repayments but dynamics, or don’t have cash available,
you can still help your children work