La Trobe Financial has adapted a contributory sub-fund structure in its La Trobe Australian Mortgage Fund to package a first-home buyer product allowing parents to lend to their children.La Trobe launched P2C last week, promoting it as a way for parents to help their children into their first home, while avoiding the pitfalls that come with guarantor agreements, joint borrowing arrangements and monetary gifts.In a standard mortgage trust investors pool their funds and invest in a portfolio of mortgages. In a contributory scheme a small group of investors or even a single investor invests in single mortgage.La Trobe has operated a contributory sub-fund for some years and has more than A$300 million invested.The idea of P2C is that parents invest in the contributory sub-fund and the mortgage in which they invest is a loan to their child.La Trobe's head of funds management, Chris Andrews, said first-home purchases were increasingly being made with parental support. However, the normal means parents use to help their children get into a first home come with a number of problems.If the parents act as guarantors or become joint borrowers they could end up with the liability in the event the child defaults. If this happened after retirement it would be catastrophic.Monetary gifts also carry risks. Andrews said: "Gifted monies are not repayable and are at risk in the event of a subsequent marriage breakdown or dispute over a deceased estate."The P2C loan structure gives the parents control of their asset and because the loan is managed by La Trobe it relieves the parents of the responsibility of administering the arrangement. La Trobe charges an annual fee of 0.75 per cent of the value of the loan.Andrews said the term of the loan, interest rate, repayment schedule and other details were negotiable.