Buying House with Daughter

[molly1a]

Daughter would like to buy a house closer to work in Newcastle area (Cardiff, Lambton etc etc) around 300K to 320K mark
We are always up for a good investment but as she wants to live in it if we help and buy in with her we have no idea how it could be setup.
Do you buy as half each , the problem with that is our other investments are all cash flow if she pays rent then we would prob have to put same amount in so as to be even which means it is costing us not what we want to do

Has anyone got any suggestions how buying with family can be steup as the deal should be great for all involved..............

Thanks for any suggestions

 

[alexlee]

If she can't afford to buy the whole thing herself, she shouldn't buy at all.

 

[Terry_w]

If you buy it together with her then your share will probably be subject to CGT.

Why can't she buy it on her own?

 

[molly1a]

Not quite enough cash behind her would love to help but I know it would have to be very well thought out so all possibilities are covered.

Thanks

 

[Terry_w]

Maybe it would be better to lend her some cash, with a written loan agreement.

 

[DaveM]

Parental guarantee, cleaner than splitting ownership, have the guarantee removed once she pays enough down to get the correct lvr

 

[molly1a]

What does parental guarantee mean or involve?

 

[Aaron_C]

Yes, Dave's suggestion of a parental guarantee is probably a good option provided you got a property you can offer as security.

 

[wylie]

We offered a parental guarantee on our oldest son's first purchase, limited to $50K, so that the most the bank would have come to us for was $50K.

Much cleaner all round for you and your daughter. Once the equity in her house rises enough, the guarantee can be done away with.

 

[Aaron_C]

What does parental guarantee mean or involve?

It means that you offer part of your own property as the 'deposit' for your daughter's property. This helps her afford the property and avoid LMI too.

 

[Terry_w]

Lot of mucking around and extra risk too. Some banks will cap the risk though.

If would be far easier to lend cash.

 

[Shahin_Afarin]

Im with Terry on this one. I would leave the parental guarantee as the last option. If you can draw upon the equity and lend cash it would be a cleaner option.

Regards

Shahin

 

[Raddles]

Hi all
we did something similar with our daughter
What we did was we became her mortgagee
She was the owner and got the benefit of first home owner grants
We extended loans on other properties and lent her the money
We now have a mortgage as security and protection against unwanted claims and she pays a mortgage payment
We can vary the payment when there are any difficulties - like any mortgagee
and we have the knowledge that she is secure and won't be chucked out by her lender
thanks