Parents and grandparents are being warned to think carefully before handing over nest eggs to younger relatives desperate to buy a first home.
New Reserve Bank lending restrictions making it harder to get a home loan with less than 20 per cent deposit have sparked fears many first-home buyers will turn to their families to help raise the necessary funds.
Age Concern has issued a warning to its members, saying many parents and grandparents may be pressured to lend younger members of their families money or sign on as a guarantor for their mortgage.
Age Concern chief executive Ann Martin said when grown-up children got into financial strife they often asked parents to dip into savings, or expected parents to front up with cash.
She said parents needed to learn to say 'no'. Ms Martin recommended older people discussed potential lending arrangements thoroughly first and sought legal advice before agreeing to anything.
Elder Abuse and Neglect Prevention co-ordinator Heather Campbell, of Whangarei, said she had not seen cases of parents lending money for home loans, but typical cases of elder abuse involved an older person spending a lot of money on a family member.
"Outside people see that as abuse, but when you go into it the older person doesn't mind or doesn't want to report it . . . because it's a family member - but often they are being taken advantage of," she said. "I have seen abuse where the grown-up child may have control of finances, have access online to bank accounts, or they might have their parents' eftpos card."
It was tricky to pin down cases of elder abuse if the older person was not complaining about it, Ms Campbell said.
"At the end of the day there's no law against someone giving their money to someone.
"If you willingly give someone money it becomes such a grey area because there's no deception," she said.