by: Dick Stroud
Nearly a third of potential first-time buyers (31%) anticipate financial help from their parents, according to new research commissioned by the Council of Mortgage Lenders. But even more (35%) say that they would need financial help to be able to enter the housing market.
Among all of those who are already home-owners, 23% say that their parents helped them. But for younger, more recent buyers, the figure is much larger. 39% of those aged under 30 had received help, and more than 40% of those who have entered the market since 2004.
I wonder if mortgage lenders have taken on board the implications this research. The over-50s are clearly an important part of the decision making process about sources of finance when their kids buy a house.
Original Post: http://www.20plus30.com/blog/2007/05/bank-of-mum-and-dad-lend-18000-on.html
Dick,
Rabobank in the Netherlands is actually working with this fact. Since a couple of years they are offering the Generational Mortgage, where the help is built into the whole mortgage process in an easy way.
More impressively - but not to be found on their website, so maybe only offered in specific situations, is that they take the position of Bank of Mom and Pop. In other words, for first time buyers they actually buy part of the house, if there isnt enough funding. The buyer can then buy the remainder a few years later.
I think it's a brilliant showing of insight in the needs of their clients.