After struggling for years to figure out my finances, I finally made the decision to buckle down and start saving for a house. It was difficult at first, but I knew that I had to do whatever I could to get into a different place. I was tired of renting and I didn't want to live in someone else's house, so I began working with a real estate agent to figure things out. Within a few short months, I was able to find a great home that had the kinds of amenities I wanted. I decided to make a blog that reflected different real estate options people have, so here you are.
When you have kids, you want to do what's best for them, which might mean helping them out from time to time. Most of the time, the requests for help are small. However, sometimes adult children need help with larger issues, such as the purchase of their first home. If one of your kids has asked for your help with the purchase of their first home, you've got a big decision to make. Regardless of the decision you reach, it will affect you and your child. Before you make your decision, here are three things for you to consider.
Know the Budgets
When it comes to helping your child buy their first home, the first thing you need to do is sit down and determine the budgets. It's not enough for you to know your own budget. You've also got to know your child's budget. Before you decide whether or not to help your child with the purchase of the home, make sure they provide you with a detailed financial plan, including all their income, as well as their debts. You'll want to see how much money is coming in and how much is going out. If your child is uncomfortable providing you with their financial details, you should reconsider until they're willing to be forthcoming.
Think About the Future
Before you agree to assist with the purchase of a home, it's important that you think about the future. For instance, will you be using money from your retirement account? If your child doesn't repay the money, will it undermine your ability to retire? If you're going to co-sign for the house, will you be able to afford the payments if your child is unable to? If you have other children, you'll also want to think about how your assistance affects them. Will they expect the same assistance when they're ready to buy a home? These are all questions you'll need to ask yourself – and answer – before you agree to assist your child with the purchase of a home.
Know When to Say No
If you're thinking about helping your child buy their first home, you need to know when to say no. You may agree to the assistance only to have the situation change during the course of the transaction. For instance, your child may want to purchase a home that they clearly can't afford, or their employment status may change during the process. Regardless of the reason, if circumstances change, know that it's okay to change your mind, especially if the decision to assist with purchasing real estate could have devastating consequences for you.