Proof of deposit - Mortgage

cashorcheque · 14 February 2010 at 3:40PM

What about if the same guy had bought the car for £20k, and then sold the same car the next day for £20k? Would that be fraud?

Fire_Fox · 14 February 2010 at 3:56PM

cashorcheque wrote: »

What about if the same guy had bought the car for £20k, and then sold the same car the next day for £20k? Would that be fraud?

Clearly there was no intention to actually own a car, you are just buying a car to cover your tracks! Bordering on money laundering never mind fraud. You would still have to declare the loan on your mortgage application, in which case the lender would do some basic maths.

Radsteral · 14 February 2010 at 3:57PM

well that guy had to do something in order to get a morgage i guess.
Some of you here are behaving like proper comusnists, forgeting that the banks themselves arent as clean behaving
sample
me deposit 10 percent -- bank says that i didnt pass their credit score
me that very same evening going for 25 percent deposit = passing their credit score with flying colours.
i thought credit score was mainly to verifyt if applicant been ok throughout to pay bills etc

cashorcheque · 14 February 2010 at 3:59PM

Fire Fox - I think you muddle my legal question with a moral one. It's perfectly possible to buy a car, think you've made a mistake, and sell it on. People do it all the time. I was (and I was only asking) asking what constitutes legal fraud, not to define what counts as a genuine intention or not.

uk_property_expert · 14 February 2010 at 4:06PM

Firefox is correct.
Most building societies will only lend to you if you either have saved the deposit, you have raised capital by leveraging another asset or if you borrow the money from a family member and they do not want it back. Look at your ts and cs on the mortgage application form. They especially bm track back the money to its source hence their question they have asked your solicitor

Fire_Fox · 14 February 2010 at 4:19PM

cashorcheque wrote: »

Fire Fox - I think you muddle my legal question with a moral one. It's perfectly possible to buy a car, think you've made a mistake, and sell it on. People do it all the time. I was (and I was only asking) asking what constitutes legal fraud, not to define what counts as a genuine intention or not.

If you ask enough people someone will tell you it is fine to break the law. I am not addressing a moral issue as I don't have any desire to 'protect' big business, I have a desire to not encourage an otherwise law-abiding citizen to commit fraud. If your fictional person genuinely intended to purchase a car they would sell the mistake and buy another OR use the money to pay back the car loan. Proving intention is a very large part of practicing law so it is highly relevant to your query.

"No precise legal definition of fraud exists; many of the offences referred to as fraud are covered by the Theft Acts of 1968 and 1978. Generally, the term is used to describe such acts as deception, bribery, forgery, extortion, corruption, theft, conspiracy, embezzlement, misappropriation, false representation, concealment of material facts and collusion. For practical purposes fraud may be defined as the use of deception with the intention of obtaining an advantage, avoiding an obligation or causing loss to another party.

Obviously persons outside as well as inside the University can perpetrate fraud. The criminal act is the attempt to deceive and attempted fraud is therefore treated as seriously as accomplished fraud."
http://www.internalaudit.bham.ac.uk/audit/fraud.shtml

needo19 · 11 February 2011 at 2:48AM

hi,
I am first time buyer and buying a house for 96000. My mortgage was refused as I wanted to pay 10% deposit. I was then advised by my mortgage adviser that as I am working part time, if i go for 15% deposit it would not be a problem.
In order to gather my deposit, my mum has given me 3000 as gift ,3000 from my cousin as a gift and i had to borrow 1700 from my friend. When I went to the solicitors and she went through the application , there was a question regarding the deposit that have to borrowed it? I have explained that my mom and my cousins have giften me some money and i borrowed 1700 from one of my closed friend.She then advised me to get letters from all the parties who have donated you gift and lent you money and that they do not acquire any interest in the property. I have handed those letters to my solicitors.
My solicitors has said that she has to sent all the letters to mortgage lender for them to aprove it.
I am a bit worried that although the money has been transfered straight from their accounts into my accounts. I do not know why she needs an approval?
2nd worry is that whether the mortgage lender can withdray the mortgage offer or not,

i am having sleepless nights as i desperatly needs the house as i have one disabled son and expecting out second child.

please can you guy tell me why all this?i know it is to do with money laundering but i work for the same bank who i have applied mortgage with

80schild · 11 February 2011 at 10:52AM

We had 40,000 gifted to us from mine and my husband's parents. part of this was to repay neagtive equity on our current house and the rest for the deposit on the new place!
For our solicitors acting for our purchase we had to provide a bank statement showing the money being transferred from my parents account to ours and letter saying they had gifted the money and had no interest in the property.
For the solicitor acting for our sale we only had to supply a letter saying the money had come from parents-no bank statements.
Everything was fine-like you I was really worried that it would affect our mortgage offer, but it didn't!

Soot2006 · 11 February 2011 at 10:57PM

I also had a substantial gifted deposit - arrived 30 days before we made mortgage application, from France by bank transfer.
I provided a bank statement showing its arrival and said it was early inheritance and it was never questioned, nor a letter from my mother required. I too had many sleepless nights about being accused of being a drugs dealer or something. It's hard to stay rational when you're worrying about everything going wrong with your first house purchase!

Burridge60 · 11 February 2011 at 11:08PM

G_M wrote: »

Who has asked for the proof? The estate agent? Your mortgage provider? Your solicitor?

All of them should have had half a mind to enquire or at least be aware.

This might help

http://www.oft.gov.uk/shared_oft/business_leaflets/general/estate-agents.pdf

PLEASE READ BEFORE POSTING

Proof of deposit - Mortgage

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