MONEY MORAL DILEMMA: Should you still help your kids get on the housing ladder?

Former_MSE_Wendy · 8 July 2008 at 7:02PM

Here's this week's hypothetical situation for you to cogitate on:

Should you still help your kids get on the housing ladder?

Your daughter and her husband have spotted their dream house, but they’ve no deposit and there are no 100% mortgages anymore. You’d always promised to give her the money and be a guarantor, but you think the markets crashing and this is a nightmare time to buy. Do you stick with your promise and leave it to their judgement or take control even though she’s an adult, after all its your money?

Click reply to have your say.

Previous MMDs:
Should Alan give the laptop back?
Should you foot the bill?

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*Louise* · 9 July 2008 at 12:22AM

I don't think it's a matter of taking control, more like giving facts about the state of the market at the moment, and giving advice. If I had the money there, I would give her it - but she would need to convince me why it had to be THIS house RIGHT NOW iyswim. Otherwise my advice would be for her to wait.

I'm hoping my daughter will grow up to be sensible enough to realise her mother is always right, hehe.:D

jamescoleuk · 9 July 2008 at 2:32AM

This is not like lending someone a sweat-shirt and not getting it back. It's money, it's serious and I would never fund something I knew to be a financially unwise decision. If it were their money I would do everything in my power to prevent them making a foolish decision.

And anyway, how much can their dreams be worth to them if they haven't bothered to save for a deposit? Not that much, they can wait.

I would maybe compromise by taking the money I promised them and investing it, or putting it in a savings account, so they could see it was waiting in the wings for the next swing upwards.

dudleyboy · 9 July 2008 at 7:01AM

If you don't mind seeing thousands of your hard earned pounds being eroded away within a matter of months then sure, why not...?(!)

Dorrie · 9 July 2008 at 7:17AM

No deposit saved up? Why not? No way would I give my daughter my hard earned cash when they can't even be bothered to do their bit.

Sharp_Eyes · 9 July 2008 at 7:29AM

jamescoleuk wrote: »

And anyway, how much can their dreams be worth to them if they haven't bothered to save for a deposit? Not that much, they can wait.
quote]

I agree. I was just going to post that if they had showed some financial plans that they are ready to have this house then I would advise on the market, and tell them to wait until we have a clearer picture of the future. No sense them starting off with their heads under water! Eventually we could try to come up with a plan and maybe match what they had raised for the deposit if it was substantial enough. Houses don't just need initial buying. There are scads of fees involved, there are repairs to consider as well as furnishings and decorations. If they are depending on parents for all of that, hard luck!

stogiebear · 9 July 2008 at 8:03AM

The answer is very simple... (I know because it has worked twice for me.)

MATCH their deposit... not a penny more - not a penny less.

Tell them from the very start of their house buying quest that this is what you are going to do and make sure that if the house is sold in the future that you get that 'gift'
back. And do it properly through an attorney.

If it's their dream house then it's basically an interest free loan for life which they never have to pay back unless they sell. If the marriage falls to bits then you won't have wasted your own money.

LittleEarner_2 · 9 July 2008 at 8:33AM

stogiebear wrote: »

MATCH their deposit... not a penny more - not a penny less.

Tell them from the very start of their house buying quest that this is what you are going to do and make sure that if the house is sold in the future that you get that 'gift'
back. And do it properly through an attorney.

If it's their dream house then it's basically an interest free loan for life which they never have to pay back unless they sell. If the marriage falls to bits then you won't have wasted your own money.

Completely agree. If you truly have a dream, you will want to work for it. Sacrifices need to be made, etc. I would be more inclined to help them cut back and save enough for a deposit first. Once they have achieve that, then offer something to top it up later on.

Ebenezer_Screwj · 9 July 2008 at 8:45AM

The savings ethos has been cast to the winds as being "old fashioned" no doubt. The chickens have come home to roost on this one - no sense of responsibility, no savings, no deposit, no house. Tough.

Glyn · 9 July 2008 at 8:57AM

Whilst I do sympathise with youngsters in the present climate... I , probably like the previous mailers ..have learned from 'being around a bit' and know from previous slumps that if you buy at the 'wrong time' you stand to loose big time.. even loosing the house its self if you cannot keep up payments on the mortgage. If they can rent for a while longer.... then maybe save in that time... they will be showing a maturity..and I would be happy ( if able to myself) help with a 'matching of deposit'. I would also help maybe with things like moving fees and furnishing when the time came. But at the mo... I think its unwise to throw money at it...not till we have an idea of how long this little slump will last.
I also think it is a lesson to learn (that a previous generation knew from the start).... that if you cant afford something easily ...you cant afford it ....full stop!

A.Jones · 9 July 2008 at 9:01AM

For me it would depend on the circumstances. If for example, they lived in our house on a "temporary" basis for the last few years and we wanted our own space back, then I would be more inclined to say yes. If they were renting somewhere else, then no.

MONEY MORAL DILEMMA: Should you still help your kids get on the housing ladder?

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