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Remortgage Parents Warned Against Selflessness
(presented by www.refinance-refinance.net - mortgage lenders)
By Michael Eccles
Many are choosing to remortgage or release equity from their own homes or take on substantial debts to provide a deposit.
However, financial advisers warn that this could compromise their own financial security, especially if they are nearing retirement and may struggle to repay loans.
Dunfermline, told the Scotsman: “Parents are now certainly trying to help the children in the way of property purchase and education. The greatest change in parental circumstances is now helping to put the children on the property ladder.”
“More parents are now remortgaging their own property or - if they are in the age bracket - taking equity release on the property.
“Parents are getting themselves in more debt at the time they should be starting to relax and have more time for holidays simply due to the burden placed upon them to help siblings through the property boom.”
Recent research by Abbey found that nearly a quarter of first-time buyers are banking on their parents to fund a deposit, while 13 per cent will ask a parent to act as a guarantor on their mortgage.
Parents are increasingly accepting that they will have to financially support their children even after they have left home, new research suggests.
Escalating university debt and the high cost of housing means that young adults today are financially independent at a far later age than in previous generations.
An AA Savings survey found that by 2008, 8.5 million couples will still be paying for their children after they have left home.
Moreover, a quarter expect that financial difficulties will force their child to move back to the family home at some point, with three in five saying they would be welcomed with open arms.
some poi
nt, or come cap in hand for cash.
“Encouragingly, 16 per cent say they have savings put aside for just that purpose.”
However, not all parents will support their children into adulthood.
Nearly one in five plan to turn an empty nest to their advantage; planning to either move to a new home or take a dream holiday, possibly paid for by remortgaging.
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