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Webinar replay: Private Client Webinar: The Bank of Mum and Dad - Considerations for loaning money to your children

Webinar Replay

 

Download the webinar presentation slides (PDF) here.

The webinar was presented by our panelists, Senior Associate Angelo Bistolaridis, Senior Associate Jana Sosner, and Associate Camille BroadhurstIlana Kacev facilitated the session.

It is not uncommon for children to receive financial support or a financial contribution from mum or dad (or even another family member) to get a foot in the property market. The “Bank of Mum and Dad” is now the fifth biggest home lender in Australia, with 29% of parents reaching into their wallets to help their children.

While many parents may assist their children with no intention of receiving repayment, a loan may still be the most prudent approach rather than a gift. Some of the key considerations for any parent are:

  • Will I need this money in the future?
  • What happens if my child defaults on their other loan/mortgage to another bank? Will I get my money back?
  • What happens if my child goes through a relationship breakdown? Will their ex get the property or my money?
  • Can I do the same for my other children and how does this affect my Will?
  • What happens if this strains my relationship with my child or other family? 

In this webinar, our expert panel discussed:

  • Different approaches to documenting loans. This webinar will cover everything from “shaking on it”, to a simple “I O U” to “belts and braces” documentation.
  • Common characteristics and terms found within loans, including approaches to repayment, interest rates and terms of default.
  • The different levels of protection each approach affords the lender and steps a lender can take to maximise protection.
  • The treatment of loans by the Family Court, where a party to the loan is going through a relationship breakdown.
  • The treatment of loans in estate administration and/or estate litigation, where a party to the loan has passed away.

 

How we can help

If you require any further information on this topic, please contact Ilana Kacev, Angelo Bistolaridis, Jana Sosner, or Camille Broadhurst.

For more information, we encourage you to visit our Family Law, Wills and Estate Planning, and Dispute Resolution pages which are updated regularly with insights and materials.

You may also like to subscribe to our mailing list here to stay up to date with our Alerts and upcoming events.

 

 

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