The Bank of Mum and Dad refers to financial support provided by parents or family members to help someone buy a home. This support could be a gift, a loan, or another arrangement that helps with a deposit, upfront costs, or improving borrowing capacity.

Parents can provide support in several ways, including gifting money towards a deposit, providing a family loan, acting as a guarantor (where available), or helping with other costs associated with buying a property. The right option will depend on the family’s circumstances and financial goals.

It depends on how the support is structured. Some families provide a genuine gift that does not need to be repaid, while others set up a formal loan agreement. It’s important that everyone understands the arrangement clearly before money changes hands.

A contribution from family may help your child reach their home ownership goals by increasing their available deposit or reducing the amount they need to borrow. However, lenders will consider their overall financial situation, including their income, expenses, credit history, and ability to repay the loan.

A contribution from family may help a buyer increase their deposit, reduce the amount they need to borrow, help them avoid additional costs like Lenders Mortgage Insurance or improve their overall home-buying position. However, lenders will still assess the applicant's income, expenses, liabilities, credit history and ability to meet ongoing loan repayments. Family assistance can strengthen an application, but it does not guarantee loan approval.

Yes. While family support can be helpful, it’s important to consider the impact on both parties. Parents should make sure providing financial assistance does not affect their own retirement plans or financial security, and buyers should be clear about any repayment expectations.

A formal agreement can help avoid misunderstandings and provide clarity for everyone involved. Depending on the arrangement, families may wish to seek independent legal or financial advice to make sure the terms are understood.

There is no set amount that parents can contribute. The amount will depend on the family’s available funds, financial position, and the buyer’s home ownership goals. It’s important to consider what is affordable and sustainable for everyone.

Lenders may ask questions about where the funds have come from and whether the money is a gift or a loan. Documentation may be required to confirm the nature of the contribution and ensure the lending application meets their requirements.

Inviva can help you understand your options and guide you through the process of exploring home finance solutions. Our team can help you consider how family support may fit into your broader home ownership plans.