Parental loans for property deposits ‘to double’
Future holders of mortgages for professionals are increasingly relying on the "bank of mum and dad" for help with their deposit, new research from Heartwood Wealth Management suggests.
Tightening lending criteria from mortgage firms due to the credit crunch are making it tougher to secure a loan without a significant deposit - even for young barristers and pharmacists.
According to Heartwood, this has led ten million British parents to earmark around £223 billion-worth of financial assistance to help lift their children on to the property ladder.
This dwarfs the 5.5 million who have already doled out £116 billion for this purpose - and this upwards trend points to a general increased reliance on parental loans among youngsters.
A hard core of 150,000 parents were even found by Heartwood to have given their children over £100,000 towards buying a home.
David Lough, chief executive at the firm, commented: "Given the size of the sums involved, it is vital that parents factor this into their financial plans."
He added: "Our research shows that those parents preparing to make this gesture on average expect to see just five per cent of their outlay returned to them."
Tightening lending criteria from mortgage firms due to the credit crunch are making it tougher to secure a loan without a significant deposit - even for young barristers and pharmacists.
According to Heartwood, this has led ten million British parents to earmark around £223 billion-worth of financial assistance to help lift their children on to the property ladder.
This dwarfs the 5.5 million who have already doled out £116 billion for this purpose - and this upwards trend points to a general increased reliance on parental loans among youngsters.
A hard core of 150,000 parents were even found by Heartwood to have given their children over £100,000 towards buying a home.
David Lough, chief executive at the firm, commented: "Given the size of the sums involved, it is vital that parents factor this into their financial plans."
He added: "Our research shows that those parents preparing to make this gesture on average expect to see just five per cent of their outlay returned to them."
