Using Your Home Equity to Give Your Kids an “Early Inheritance”

A practical guide for Ontario parents who want to help their kids buy a home

Many parents reach a point where they look at the housing market and think, “How will my kids ever do this on their own?”If that is you, you are not alone. More and more Ontario parents are choosing to use a portion of their home equity to give their kids a head start. We often call this an “early inheritance,” and done thoughtfully, it can make homeownership possible decades earlier for the next generation.

Here is what to consider.

Why an early inheritance can make sense

You worked hard to build equity. For many families, using a small piece of that equity now can create more impact than leaving it later.

Parents often choose this route because:

• Their kids are responsible but priced out of the market

• They want to see their children settled and secure

• They prefer helping now instead of passing everything through an estate

• They want their grandkids growing up in stable housing

• They know the market might continue to climb, and waiting could make things harder

It is about creating stability, not handouts.

Common ways parents access equity

You do not need to sell your home to help. Most families use one of these three approaches:

1. A small refinance

This replaces your current mortgage with a new one and allows you to pull out a portion of equity.Parents often choose this if they still have a traditional mortgage and want a predictable payment.

2. A Home Equity Line of Credit (HELOC)

A HELOC gives you access to funds without needing to borrow all at once.This offers flexibility if you want to help more than one child or support them in stages.

3. A blended early-inheritance plan

Some families mix approaches, for example using a small refinance now and keeping a HELOC for future needs.

There is no “right” way. What matters is choosing the option that protects your comfort, cash flow and long-term plans.

How the funds can help your child

Even a modest amount of equity can make a meaningful difference.

An early inheritance can help with:

• Down payment support

• Closing costs

• Moving expenses

• Reducing the size of their mortgage

• Helping them qualify for a home that fits their long-term needs

Many parents prefer giving support as a gift. Others structure it as a loan, with clear expectations. Both are common and completely acceptable.

Things to think about before moving forward

A family meeting can help ensure everyone is on the same page. Some helpful topics include:

• Is this a gift or a loan

• How much support feels comfortable

• Whether siblings will receive similar help

• How this fits into your overall retirement plans

• What boundaries or expectations need to be clear

Good communication reduces stress for everyone involved.

A real advantage: You get to see the impact

One of the biggest reasons parents choose an early inheritance is simple.They get to witness their support making a difference.

You see your kids settle into a home, build stability, grow equity and start their own financial journey. For many parents, this feels far more meaningful than passing everything through an estate decades later.

Want help reviewing your options?

If you ever want a neutral, judgment-free voice in the room, we are always happy to join your family meeting and walk through the options in plain language. Our role is simply to help everyone understand what is possible so you can make a decision that fits your family values and financial comfort.

Never be too shy to call.