In recent years, many parents have opted to assist their adult children in purchasing a home, often providing loans or guarantees to help bridge the gap in down payments. While this might seem like an act of goodwill to support their children’s financial futures, the potential consequences can be much more complex and costly, especially when relationships take an unexpected turn.
The case of Massaar v. Moneck, 2024 ONSC 6889, serves as a cautionary tale for parents who find themselves involved in such financial arrangements.
In Massaar v. Moneck, the Ontario Superior Court of Justice dealt with a case in which the parents, who had loaned a significant sum of money to their adult child and their partner to purchase a home, found themselves embroiled in a lengthy and expensive legal battle when the couple separated. The parents had provided financial assistance, believing they were helping their child achieve homeownership and financial stability. However, when the relationship broke down, the loan became the focal point of disputes, leading to legal proceedings that spanned over multiple years.
The central issue in this case was the repayment of the loan and the parents’ involvement in the property transaction, particularly after the separation of the couple. The parents found themselves not only financially invested in the property, but also entangled in legal proceedings with their child’s ex-partner. This scenario highlights the significant risks involved when parents provide loans to their children to help them buy a home, particularly when the relationship between the parties is fragile.
One of the most immediate impacts on parents in such situations is the financial cost. In the Massaarv. Moneck case, the parents were left with a legal battle that involved a considerable amount of time and money. Legal fees, court costs, and the complexity of resolving financial disputes in the context of a relationship breakdown can quickly spiral out of control. The situation often involves multiple parties—parents, children, ex-partners, and potentially even other family members—all of whom may have competing interests and claims.
Moreover, the legal process can be lengthy and emotionally taxing. As illustrated in Massaar v. Moneck, when the relationship between the parties is strained or hostile, it can be challenging to navigate the financial agreements and come to a resolution. For the parents, this can mean months or even years of stress, uncertainty, and aggravation, with no clear resolution in sight. In some cases, parents may find themselves paying not only for legal representation but also for additional mediation or arbitration, adding further to their financial burden.
When parents lend money to their adult children, the loan is often tied to the property, which complicates matters further in the event of divorce. In Massaar v. Moneck, the parents were forced to contend with delays caused by the need to determine the value of the home, the outstanding loan balance, and how the property should be divided or sold. The courts often have to wade through complex financial arrangements and legal contracts, which can lead to significant delays in finalizing matters.
In many cases, divorce can leave the spouses uncertain about the future of the property. Parents may be left wondering whether they will ever see the money they loaned returned, especially if the property is not easily sold or divided. Even if the parents are legally entitled to the loan repayment, the process of enforcing this right can be time-consuming and fraught with complications, including disputes over the amount owed or the value of the property.
Another key issue for parents in situations like those in Massaar v. Moneck is the emotional toll of being caught in the middle of family conflict. In cases of separation, parents may find themselves torn between their love and support for their child and the reality of their financial involvement in the relationship. Additionally, when the ex-partner is involved (aka son-in-law or daughter-in-law) in the dispute, it can add another layer of complexity and animosity.
Legal entanglements often bring out negative emotions, especially if the parents feel that their good intentions have been taken advantage of. The Massaar v. Moneck case illustrates how family members can end up in prolonged and contentious legal battles, even when they have the best intentions. Parents might find themselves questioning their role in the financial arrangement and wondering whether they could have done things differently to avoid such a situation.
For parents considering loans or financial support to help their adult children purchase a home, the Massaar v. Moneck case offers several important lessons. First, parents should have clear, formal agreements in place regarding the loan—preferably drafted by a lawyer—to ensure that their rights and interests are protected. This agreement should clearly outline the repayment terms, interest (if any), and the consequences of default. It should also address what happens in the event of a relationship breakdown or divorce.
Second, parents should be aware of the potential risks involved, particularly in situations where they may not have control over the property’s future. If the relationship dissolves, the parents may not only face financial challenges but also emotional strain and conflict.
Finally, parents should consider whether it is wise to involve themselves in such financial arrangements in the first place. While the desire to help a child is understandable, the financial and emotional costs of such decisions can be substantial, especially when things go awry.
The case of Massaar v. Moneck underscores the significant risks and complications that arise when parents loan money to their adult children to purchase a home, especially when relationships deteriorate. The financial costs, delays in resolving disputes, and emotional strain can be immense, leading to years of frustration and uncertainty. As the case highlights, parents must carefully consider the full extent of their involvement and seek professional advice to protect their financial and personal interests. For those who do decide to lend money, clear legal agreements and realistic expectations are key to avoiding the turmoil that often accompanies such arrangements.
Editorial note: This article was first published on LinkedIn in October 2025 and is republished here for reference.
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