1st Time Buyers Mortgage Application - Deposit is a gift we don't yet have

somethingcorporate

Agreed, if they retain interest in the house (i.e. money when it sells in future) it is not a gift and the mortgage company should know.

In terms of having the deposit visible I very much doubt it would be an issue, it hasn't when we have bought in the past. The only time it was an issue was when we were offering on a property and at the last minute the EA demanded we provide proof of deposit so they could "recommend" our offer. Jokers!

donkey1969

Op we had a gifted deposit, all we had to do was supply a letter from the family member gifting it to declare it was a gift, and they wouldn't want repaying or have an interest in the property, that was for the solicitor more than the bank, but our sol was acting on behalf of us both, the sol also required a copy of the bank statement showing the transfer and my family member also supplied ( without being asked for it ) proof of where the money originaly came from.
Meant to say we also didn't have the money in our account at the time of the formal mortgage offer being made.
Good luck, hope all goes well

Ms_Scarlett_2

donkey1969 wrote: »

Op we had a gifted deposit, all we had to do was supply a letter from the family member gifting it to declare it was a gift, and they wouldn't want repaying or have an interest in the property, that was for the solicitor more than the bank, but our sol was acting on behalf of us both, the sol also required a copy of the bank statement showing the transfer and my family member also supplied ( without being asked for it ) proof of where the money originaly came from.
Meant to say we also didn't have the money in our account at the time of the formal mortgage offer being made.
Good luck, hope all goes well

Thanks donkey, that's really helpful.

Ms_Scarlett_2

I am quite stunned at the response I have got from some people here, as it has absolutely never occurred to me anyone could perceive what has been put to me by my Dad as "a family matter" as fraud. That certainly hasn't been my intention, anyway, so I've been a bit godsmacked at some of the more hostile comments. Still, I guess I should thank you, as clearly this is exactly how it would be perceived by a mortgage company...

My parents would definitely like to gift me this money, but it's a big chunk of their savings that I don't think they are yet 100% sure they can do without forever more. All being well, it will be a gift and I won't pay it back, but I guess I just don't really like the thought of robbing them of the savings they've worked so hard for.

How do you explain that hot mess to a mortgage company without getting an instant reject? (NB. This is a genuine question, not a rhetorical one. Editted to make this 100% clear.)

saverbuyer

Ms_Scarlett wrote: »

Thanks donkey, that's really helpful.

Yes it’s always helpful when someone else tells us it’s ok to lie. I mean it’s only a small lie. Is your deposit of several thousand pounds a gift or a loan?

I often wonder the extremes people go to just to buy a house. Fraud seems very common.

Ms_Scarlett_2

saverbuyer wrote: »

Yes it’s always helpful when someone else tells us it’s ok to lie. I mean it’s only a small lie. Is your deposit of several thousand pounds a gift or a loan?

I often wonder the extremes people go to just to buy a house. Fraud seems very common.

I don't know why I'm feeding the troll here, but I don't think donkey said anything remotely akin to "it's OK to lie" - s/he just explained about her own personal situation in receiving a family gift, which is helpful information to me. I don't think s/he intimated anywhere about whether or not their gift was a gift, a loan or somewhere in the messy inbetween as mine has theoretically been up until now - she just gave a clear answer to a question I had asked, which is why I thanked her.

Clearly I do need to go and firm up with my family exactly what is going on here, but I am not some horrible person looking to commit a crime and I resent being accused as such. You could have made all of your points in a far less inflammatory manner and I still would have taken your advice onboard, but without feeling as though I've been given a public flogging.

When I first saw the "newbie alert" thing, I thought it was quite funny. Clearly there's a good reason for them - you need thick skin to post around here.

GMS

The source of deposit needs to be disclosed.

Most lenders are ok with a family gifted deposit. The donor would usually need to sign a declaration to the effect of 'The sum is a gift and I/we will have no interest in the property'

If it is a loan then lenders may refuse.

If it is stated as a gift, mortgage offers then solicitor is not satisfied that it is a non repayable gift then the solicitor will refer it back to the lender.

Be honest from the outset. If the lender is happy then you should have no issues.

Getting an offer is not the end of it. Offers can be pulled right up to completion so make sure what the lender know is verified by the solicitors.

saverbuyer

Ms_Scarlett wrote: »

I don't know why I'm feeding the troll here, but I don't think donkey said anything remotely akin to "it's OK to lie" - s/he just explained about her own personal situation in receiving a family gift, which is helpful information to me. I don't think s/he intimated anywhere about whether or not their gift was a gift, a loan or somewhere in the messy inbetween as mine has theoretically been up until now - she just gave a clear answer to a question I had asked, which is why I thanked her.

Clearly I do need to go and firm up with my family exactly what is going on here, but I am not some horrible person looking to commit a crime and I resent being accused as such. You could have made all of your points in a far less inflammatory manner and I still would have taken your advice onboard, but without feeling as though I've been given a public flogging.

When I first saw the "newbie alert" thing, I thought it was quite funny. Clearly there's a good reason for them - you need thick skin to post around here.

I'm not a troll.

I'm just suggesting that a better option instead of doing anything to get the house and dupe the lender is to be honest and say "this is a gift but needs to be repaid if my parents need the money".

I commend your parents for offering such a generous gift. It does sound like they may need the money and you are taking a bit of a gamble here. It might be a better idea to just save the deposit. It sounds like they can't afford to lose it, which is a distinct possibility.

Ms_Scarlett_2

saverbuyer wrote: »

I'm not a troll.

I'm just suggesting that a better option instead of doing anything to get the house and dupe the lender is to be honest and say "this is a gift but needs to be repaid if my parents need the money".

I commend your parents for offering such a generous gift. It does sound like they may need the money and you are taking a bit of a gamble here. It might be a better idea to just save the deposit. It sounds like they can't afford to lose it, which is a distinct possibility.

See? You can make your point without out and out hostility. That wasn't so hard now, was it?

It's nice to be nice.

tyler80

At no stage did anyone ask to see evidence of our deposit. We declared that part of our deposit was a gift from parents but neither the solicitor or the bank wanted any proof of it's origin nor did they require a signed letter stating it was a gift rather than a loan.