Written for The Australian Newspaper – The bank of mum and dad
Trying to purchase a home in the Sydney property market is challenging given the rise in prices over the past few years.
One strategy children in their 20′s and 30′s have employed to crack the market has been to ask their parents/parents-in-law to provide financial guarantees over the loans they are taking out to help them get a loan they:
a – otherwise would not get
b – may get but with financial penalties (such as large lenders mortgage insurance payments)
I wrote the article after interviewing several people in the finance/property industry and sought their opinion about family guarantees, what they are, what are the risks, what should people thing about and how to look at it further.
A link to a PDF version of the article can be accessed below: