Many parents are now helping adult children buy their first home in Queensland. For some, it’s a contribution towards a deposit. For others, it’s a loan to bridge the gap between savings and borrowing capacity.

In most cases, the motivation is simple: you want to help your child get a foothold in the property market. But without the right legal structure, that assistance can unintentionally create risk — particularly if relationships change or if the money is still outstanding when your estate is administered.

A little planning up front can protect both your contribution and your family relationships.

Why defining your intention matters (gift vs loan) 

One of the most common issues we see is uncertainty about intention. Parents often expect that money advanced to a child will be repaid at some point, or at least taken into account later when their estate is divided. But if nothing is documented, that contribution is usually treated as a gift — regardless of what was discussed at the time.

This can become problematic if a child separates from their partner, the property is sold and proceeds are divided, or other children later question how the assistance was meant to be treated.

Using a family loan agreement to protect your contribution

Some parents hesitate to formalise a loan because it feels uncomfortable or overly legal. In practice, a written loan agreement is one of the best ways to protect everyone involved.

A properly prepared agreement can set out repayment expectations, what happens if the property is sold, and how the arrangement is treated over time.

In some cases, parents may also choose to secure the loan against the property by way of a registered mortgage. While this is not necessary in every situation, it can provide additional protection if the relationship ends or other circumstances change.

Importantly, securing a loan does not mean that repayment is expected immediately. It simply ensures the contribution is recognised and protected if the property is sold or circumstances shift in the future.

Protecting your investment if your child’s relationship breaks down

One of the biggest concerns for parents is whether money advanced to help with a purchase could effectively end up benefiting a child’s partner following a separation. Without the right structure, this is a real risk of losing significant capital.

A documented and, where appropriate, secured loan can help ensure your contribution is recognised and preserved if the property is divided.

Buying with a Partner: Ownership Structures Matter

Where a child is purchasing property with a partner, the way the property is legally owned can be just as important as how parental assistance is documented.

Many couples purchase property as joint tenants, which means that if one owner dies, the property automatically passes to the other — regardless of what a Will says. While this can be appropriate in some circumstances, it may not always reflect a family’s broader estate planning intentions.

In contrast, purchasing as tenants in common allows each party to own a defined share of the property (for example ½ share). This can provide greater flexibility, particularly where one party has contributed more to the purchase price, or where parental loans are involved.

For parents providing financial assistance, ownership as tenants in common can help ensure their child’s interest — and any associated loan — is clearly identifiable if the relationship ends or the property is sold.

The right ownership structure will depend on the family’s circumstances, the source of funds, and how the assistance is intended to be treated over time. It is often best considered alongside loan documentation and estate planning advice, rather than as an afterthought.

How this fits with your Will and estate planning

If a loan remains outstanding at the time of death, it forms part of your estate. If your Will doesn’t deal with it clearly, executors may be left in a difficult position and disputes can arise.

Your estate plan should clearly address whether the loan is to be repaid, forgiven, or taken into account when dividing assets between beneficiaries. Clear treatment of parental loans can also help preserve fairness between children and reduce the risk of disputes later.

In some cases, parents fund a loan using superannuation withdrawals. Where this occurs, it’s important to consider how the loan is treated alongside superannuation death benefit nominations, as super does not automatically form part of the estate. Ensuring these elements are aligned can help avoid unintended imbalances between beneficiaries.

 First home buyers and practical considerations

Parental assistance does not automatically affect a child’s eligibility for Queensland first home buyer grants or stamp duty concessions. However, the structure of the transaction does matter.

Where parents take an ownership interest, or where trusts or companies are involved, land tax and ongoing holding costs should also be considered as part of the overall structure.

A measured approach

Helping your child buy property can be deeply satisfying. The key is making sure the arrangement reflects your intention, protects your contribution, and fits within your broader estate plan.

At Perspective Law, we assist families to document parental loans and ensure they work alongside Wills, trusts and succession planning without unnecessary complexity.

Key Takeaways

•  Cleary identify whether the contribution is a gift or a loan.

• Ownership structure and relationship context matter.

• Security may be appropriate for larger contributions.

• Your Will and estate plan should address any assistance provided.

How We Can Help

Helping a child buy property is often done with the best of intentions, but informal arrangements can expose families to unnecessary risk. Taking advice early allows these arrangements to be structured clearly, fairly, and consistently with your broader estate planning goals.

If you would like advice on documenting a family loan, reviewing ownership structures, or ensuring your estate plan reflects your intentions, please contact our office or phone us on 07 3839 7555 to arrange a confidential discussion

Further information

Wills and Estate Planning – Perspective Law

Testamentary Discretionary Trusts

Jointly Owned Property and Estate Planning