Money News

One in three parents remortgaging to help adult kids

The ‘Bank of Mum and Dad’ gets into full swing as parents try to set up their grown-up children with homes.

A third of parents with children in their 20s have remortgaged or are planning to remortgage to help their offspring.

Furthermore, over half of parents with children aged 18 to 30 have taken a loan or plan to do so to aid their children financially, according to research by The Children's Mutual.

Only 7% of parents said they would not fund their adult children in any way.

David White, chief executive of The Children's Mutual, said: “These figures unveil the stark reality of the cost of being a parent.

“No longer does turning 18 mean financial independence - in fact 16% of parents questioned expected their child to remain financially dependent on them into their thirties and beyond.”

He added the message for parents with young children was to save early.

A third of parents are offering support for bills and 48% had offered their children money to help with general living costs.

Some 14% of parents gave their children money to pay off debts.

Chris Eagle, commercial manager at Creditchoices.co.uk, said: “Last week the Council of Mortgage Lenders reported the number of loans to first-time buyers was at a two-year high in December.

“With the average first-time buyer mortgage being at 75% loan-to-value and needing a £38,000 deposit, it is unsurprising children are looking to the Bank of Mum and Dad for help.”