New Trend: Parents using Real Estate to Finance Child’s Future

As a parent, you will do anything to give your child an advantage in life.  With rising home prices in the GTA, parents are co-signing loans and mortgages with their children to help them get approval.  There are several ways to approach co-finance a property with your children, at Gail Sylvester Mortgages, we will help you explore which option is the best option for you.

Parents Supporting Kids by Co-signing Mortgages

Co-signing loans or mortgages is a way to help your kids sign a lease or a mortgage as many young people do not have the wealth, credit history, or appropriate salary to qualify on their own.   Some view co-signing as a risky option, and it can be.  The best way to approach co-signing is to have the proper provisions in place to ensure your child understands the gravity of missed payments. Owning property together is a fantastic way to teach debt management in real-time.  Co-signing is not an agreement to pay the payments, it is lending your support to give your child a head start in a real estate market with increasingly strict qualifying measures.


Purchase an Investment Property for Your Child

Saving for your child’s future can be done with RESP, TIFSA, and, perhaps, a less traditional option, Real Estate.  It may be unconventional but, purchasing a rental property, typically a rapidly appreciating asset, provides the opportunity for immediate passive income and an asset that can be sold to pay for school, a down payment, or a business venture at the age of maturity.  Real Estate provides flexible options for your child in the future.

Protect your Child from Crippling Debt

 Helping your child understand finances at a young age will empower them to make sound financial decisions in adulthood. Co-signing or co-owning a property with your child will allow them to see first-hand how smart money management requires sacrifice and hard work while offering valuable rewards.  Learning money management skills will help the entire family develop healthy financial habits. 

Gail Sylvester Mortgages has great news to share - we have recently opened the doors of our new office in Hamilton!  Drop by our brand-new office, 1030 Upper James St suite 203, to meet the Gail Sylvester Mortgage team.  We are always here to help you achieve financial well-being by creating a financial plan that will allow you to sleep at night.  Let’s get your money working for you and your family today.