First time buyers turn to parents for housing loans, financing study suggests

Financial Services > Personal Loans > News

Fri, 20 Apr 2007

New loans research has underlined the number of people across the UK who turn to their parents to help take their first step on the property ladder.

According to a study by financial services provider Scottish Widows Bank, approximately 39 per cent of graduate first time buyers admit that their property aspirations would be unattainable without borrowing from mum and dad for a deposit.

Moreover, it appears that the past decade has seen an increasing number of people arranging loans with their parents.

Whereas nine per cent of graduate first time buyers arranged a parental loan in 1996, this proportion doubled to 18 per cent in 2006.

"While it's good to see that people are getting help from their loved ones, some of these loans may be leaving the bank of Mum and Dad empty," remarked Richard Clark, head of product development and marketing at Scottish Widows Bank.

"Lenders like ourselves offer alternative solutions for graduate first time buyers."

The issue of parental financing support has risen to prominence in recent years as a result of rising house prices and programmes such as BBC Two's The Bank of Mum and Dad.

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