An agreement with my adult child in writing can be very important. Many parents would do anything to help out their children, even after they have left the nest. In this difficult real estate market, it’s impossible for many young people to buy a new home without some assistance from their parents. Sometimes the parents intend to give that money to their child, and sometimes they expect to get it back. Either way, it’s better to have that intention clearly set out in writing.
While the temptation is always there to simply trust your family, life has a way of going in unexpected directions. A divorce can mean that gift ends up going to your child’s spouse rather than your child, and a bankruptcy can turn a safe real estate investment into a loss. When someone’s home or life savings is at stake, even strong families can be pushed to the breaking point. Sometimes a little more work upfront can save years of heartbreak.