The statistics released today suggest that parents have become the 9th largest lender for property purchases. Much of the comment in the press relates to the questions this raises about the state and affordability of our housing market for first time buyers.

My first response when reading these statistics was concern as a family lawyer about risks of future litigation. Throughout my career I have been involved in countless cases involving parents having loaned or gifted money to children. The problems and litigation normally come when the child cohabits, marries or divorces. Unless appropriate steps have been taken to protect that money, it can often be "lost" into assets being shared between the child and their spouse (or cohabitee). These type of situations are very distressing for the parents as the money provided to their child for a particular purpose is unlikely to be able to be fully retained by their child unless formal agreements are in place.

It is always sensible to get legal advice about how loans (and gifts) will be treated in the future as often there will be a legal agreements that can be drafted to protect the money such as declarations of trust, loan agreements, cohabitation agreements and prenuptial and postnuptial agreements. More information about these options can be found at and

Helping our children financially is an understandable desire, but protecting them from losing this money in future claims is often overlooked until it is too late.