BOMAD – What are you talking about???     Some statistics to ponder … UK 2017 – $12 billion of lending was from the bank of Mum and Dad 30% up on the previous year Australia 2017 $71 million of lending from BOMAD 5th largest lender 52% of first home buyers are used BOMAD NZ 2017 6th largest lender $90,000 is the average size loan 60 – 70% are first home buyers So what are the issues/considerations for both parties? What is the intention of BOMAD – Is it a loan or a gift? Are you financially in a position to lend or gift this money – what impact will it have on your retirement if you are not repaid and had anticipated being repaid.  Would you like objective advice around this? Does this impact on the expectations of other family members? Have you as potential BOMAD considered the time value of money?  If one child has use of money at the age of 30 and this enables them to get onto the property ladder, they can make far more effective use of this money, compared to your other children who may not access the money until they are in their 50’s or 60’s. How can you protect all parties? Good lines of communication Robust and independent legal advice – you may decide to have a percentage ownership of the home. Limit the liabilities of BOMAD with both the lender and via the estate planning vehicles available to you. Some examples: – Have a written acknowledgement of debt that is signed … Continue reading BOMAD – What are you talking about???