On the other hand, if the parents' savings have been depleted by stock-market fluctuations, a bigger loan may be a sensible course, since they are likely to recoup some of their losses over time.

It is calculated based on the difference between the market value of the stock and the loan made by the lender.

The sub-prime mortgage loan crisis happened in US since last summer has maintained its effects on the US stock market, financial system, overall economic performance as well as the rest of the world.