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Original poster

Should we help daughter out?

111 replies

Twospaniels · 11/07/2023 17:53

Daughter and her partner - their fixed rate mortgage ends in September and to stay with the same Bank their payments will double. They have been online and can find a lower payment mortgage.
However, if the rates go even higher they will struggle to meet even higher payments.

Should we help them out? Or should they just ride it out themselves even if it means they have to sell their house. They are in their 20’s without children.

We have no mortgage and are retired with investments

OP posts:
Wallywobbles · 11/07/2023 21:54

It's not a great long term solution. What's their plan?

Viviennemary · 11/07/2023 21:56

If you can help,them out without depriving yourself then do. But they need to cut back on theirown expenses.

Fluffyowl00 · 11/07/2023 21:57

I feel like this is going to be in the daily fail tomorrow. Because …there’s nothing else going on

Equalends · 11/07/2023 23:08

No illness or anything terrible to disadvantage them but both DH sister and my siblings are all worse off than us so our parents always helped them. It seemed like a reward for being shit at life.

I would only want to give money if the amount given was gifted in such a way that in the event of a split my child’s part was ring fenced, married or not.

wineschmine · 12/07/2023 09:33

@Twospaniels how much help were you planning on giving monthly?

If it's a substantial amount, another option might be to give them a lump sum to reduce the outstanding mortgage, thereby reducing the monthly payment, especially if it knocks them into a lower LTV bracket. That way it is reducing their debt and not just "dead money" in the form of paying exorbitant interest rates.

This would obviously depend on the amount outstanding etc as it might take a very large contribution to reduce their debt.

LadyDanburysHat · 12/07/2023 09:38

If you give them a lump sum to top up the mortgage when the fix comes to an end would it lower their LTV enough to get a better rate that would be more affordable?

Beebumble2 · 12/07/2023 09:45

Although our DCs are ok mortgage wise ATM, DH and I would certainly help them out. Fortunately we would be able to support, there are several ways to do this such as monthly top up, lump sum payment and giving them a personal mortgage payed to you. There are tax implications for all of these methods of help so tax advice would be a good idea first.
Our thinking is that we wouldn’t see them loses their homes while we have the means to help.

Beebumble2 · 12/07/2023 09:46

paid lose

whirlyhead · 12/07/2023 09:51

Not all parents help. Years ago we desperately needed funds (business partner stole a ton of money from us) and my partner's father (who is loaded) refused to help. Fortunately, we managed to dig ourselves out of the hole, but we could easily have lost our house.

Quitelikeit · 12/07/2023 10:02

If there rate is up in September why on earth have they not acted sooner - you can tie a new rate in 6 months before the end of you mortgage so they are going to be paying at least 1.5 percentage points more than they needed to

Get them to call London & Country who have access to most lenders

Yes I think it’s a great idea to help them out. It’s the way of the world unfortunately. I’m expecting to have to do similar going forward

Proudofitbabe · 12/07/2023 10:35

There is no way on this planet earth my parents would see me forced to sell my home if they were mortgage-free and had investments. In fact they could be struggling themselves and still offer. Don't think my ILs would, but they're not the parents mine are. So that's my take! Obviously this assumes your DD will massively do her bit to help herself.

CC4712 · 12/07/2023 11:32

I have another daughter, but she is a very high earner as is her partner - they don’t need financial help, and would not feel ‘left out’ if we don’t give them finance too.

Are you my MIL OP??? Its this exact attitude that I find so appalling! Just because 1 child is a higher earner- you would not treat them equally in terms of your handouts???

I too was going to suggest your DD goes to a broker- not a high street bank or online. I'd have everything clearly written up and whether you are loaning them the money to be paid back at X rate, before X date- or whether you are gifting them the money, which won't need paying back.

GrinAndVomit · 12/07/2023 11:34

If you can then, yes you should.

DemonicCaveMaggot · 12/07/2023 11:38

I would. I would give them a lump sum but make sure it was legally protected in some way so that if they split, the contribution to buying a percentage of the house clearly belonged to my daughter. It used to be if you survive the date of the gift by seven years it didn't need to be included in your estate, I don't know if that is still the case.

rabbitcatt · 12/07/2023 12:41

They were very financially stupid to only fix their mortgage for two years, two years ago. The rates then were stupidly low and were only going to go up.

ErrolTheDragon · 12/07/2023 12:51

If your investments are sufficient (and of appropriate types) that they should see you through retirement and you'd expect to be leaving money to your children when you die - then yes, it makes much more sense to give it to them early rather than them for house-buying having to waste money on interest and then maybe have their inheritance taxed.
If I had more than one child I'd want to make sure each got (now or later) a fair division of my assets.

isthesolution · 12/07/2023 12:55

What is your plan for the investments? If they are to eventually benefit your daughter then I'd give her the help now while she needs it.

If giving up your investments means you can't enjoy your retirement then that is a different story.

Timwith2noses · 12/07/2023 12:59

I’m not sure if I’m missing something.
The rate ends September - so they could have locked in a new deal from March - but regardless they have now seen one they can afford. So they need to secure it. Then if rates go up further it won’t affect them for presumably 2-5 years during the new fix so the concern of ‘if rates go up even further’ doesn’t matter?

Winter2020 · 12/07/2023 17:29

Both my parents and my inlaws are generous to us. We don't ask for anything but we benefit from their generosity. If they tried to tell us that we can't go out for a meal or get a takeaway because they gift money to us I would tell them to keep it. I assume they help (without trying to control us) because they want to, and they want us to enjoy a good quality of life. If they don't want to help they shouldn't - but they can't take it with them.

Help your daughter if you want to. Don't if you don't want to. But don't ask her to jump through hoops or try to interfere in her finances.

Thomasina79 · 15/07/2023 07:13

Remember that you also need to plan for your own financial future and retirement. I would help the couple if I had a good relationship and they treated me as a human being with respect. I would also teach them how to budget which was a harsh lesson for us to learn. So yes, if you can, then go for it and hope they appreciate it and don’t just treat you as a bank

cptartapp · 15/07/2023 07:34

Twospaniels · 11/07/2023 20:09

Thanks for all the replies.

I have another daughter, but she is a very high earner as is her partner - they don’t need financial help, and would not feel ‘left out’ if we don’t give them finance too.

I was thinking in terms of giving them a bit each month to top up.

they have a plan to marry in a few years time.

I would definitely not want to see them struggle and lose their home. They both work hard and earn average salaries.
Neither smoke or do drugs, they do like to go out for a meal or drinks but will have to curb that. The only holiday they have this year is one that we have paid for in full, it’s not costing them or our other daughter anything at all.

We will need to discuss with them as I know her partner will be reluctant to accept what he may see as ‘charity’.

His parents are not in a position to help them financially.

Then it's wrong to give one a lump sum and not the other.
SIL was given £10k for a house deposit and all her wedding paid for, whilst DH got nothing. He too made out he wasn't bothered. He was. Earnings are irrelevant as things can change.
You treat them both the same.

Flammkuchen · 15/07/2023 07:39

OP - glad that you will help your DD out. Those in their 20s and 30s are in a precarious position. They have student debt, face really high house prices and now high interest rates, earnings have not risen in 20 years. Their retirement will likely be much less comfortable than yours as final salary pensions have disappeared and mortgages will take so long to pay off that they will have little chance to build significant retirement savings. If they have kids, both parents typically have to work for financial reasons.

The current generation of retirees have more disposable income than those in work. This is unprecedented. Wealth is of course many times more.

Youth is wasted in the young, but wealth is wasted on the old.

Flammkuchen · 15/07/2023 07:41

and seriously do not worry about treating differently. We are fortunate to be high earners. Dh’s brother is not. When he lost his job and risked losing his home, DH’s parents of course helped him.

Why on earth would they have given us money too?

DaphneduM · 15/07/2023 08:14

Absolutely you should help them out. This is what decent parents do (if financially able to)! We gifted a deposit to our only daughter when she married, help with childcare (an absolute joy and privilege to enjoy a close relationship with our grandchild) and they know we are always supportive. The caveat to all that is that they both work hard, have both got promotions/better paying jobs in the last few years - it's tough out there for young people in their 20's/30's. I like to help them now - it will be her inheritance anyway - so it's lovely to see them in their home which is actually a fairly modest semi. Go for it OP!!!!