Options for parents when helping kids with mortgages

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by Kay Murchie

According to Peter O’Donovan of Bestinvest, the financial advice group, there are new products available that allow parents to make contributions toward their children’s mortgage.

Mr O’Donovan explained that parents have the choice as to whether they put a big lump sum in to assist the child in borrowing the money or they can use their income to assist the child in paying off the mortgage.

However, Mr O’Donovan did warn that if parents used their income to assist their children then they would be party to the mortgage, making them jointly responsible if things go wrong.

Many people preferred to give their child a cash lump sum and keep their names off the mortgage, concluded Mr O’Donovan.