Loan as deposit for mortgage?

betmunch

19lottie82 wrote: »

I assumed, based on logic

Lenders and Logic are not happy bedfellows these days I'm afraid

sonastin

Also depends how comfortably you pass their credit check. If you're a borderline case, they'll do more investigation to assess whether you are a secure lending risk. If your monthly income is 10 times your mortgage payment and you're only borrowing 30% of the property value, there is less risk in applying a bit of logic. Between the two is down to lenders discretion how much digging they want to do.

FraudBuster

Individual purchasers can commit mortgage fraud by obtaining a higher mortgage than they are entitled to by providing untrue or misleading information or failing to disclose required information. This may include providing incorrect information about:

• identity
• income
• employment
• other debt obligations
• the sources of funds other than the mortgage for the purchase
• the value of the property
• the price to be paid and whether any payments have been, or will be made, directly between the seller and the purchaser

http://www.lawsociety.org.uk/productsandservices/practicenotes/mortgagefraud/5041.article

19lottie82

Strange this subject should come up actually. I sit across from a guy in work who is a total BS’er. He told us he banks with the Halifax and last week had an appointment with a mortgage advisor in his branch. Apparently they told him that in principal they would give him a 90%mortgage and he asked if they would give him a 10k personal loan for the deposit and they said, “well we can’t, but there is nothing to stop you going elsewhere”.

Does anyone believe a Halifax mortgage advisor would actually say this?

betmunch

19lottie82 wrote: »

Strange this subject should come up actually. I sit across from a guy in work who is a total BS’er. He told us he banks with the Halifax and last week had an appointment with a mortgage advisor in his branch. Apparently they told him that in principal they would give him a 90%mortgage and he asked if they would give him a 10k personal loan for the deposit and they said, “well we can’t, but there is nothing to stop you going elsewhere”.

Does anyone believe a Halifax mortgage advisor would actually say this?

Based within a Halifax branch? Without a shaddow of a doubt yes!

19lottie82

betmunch wrote: »

Based within a Halifax branch? Without a shaddow of a doubt yes!

Really? Oh dear!

But would they be likely to offer him a mortgage basing his deposit on this? I know he has a bit of credit card debt, again with halifax.

He's a single guy earning 20k. And no savings.

betmunch

Depends on how good a job the underwriter does I spose. Nothing wrong with having a bit of debt when making a mortgage application, just make sure its all paid each month and you still fit affordability and its fine.

Your friend is going to have to declare the source of the deposit, if he puts loan he will be declined, if he doesnt hes committing fraud.

Halifax man is likely to be targetted on applications so wont go care if it goes through or not.

Credit-Crunched

claire16c wrote: »

How would they know if the money was a gift? Say a parent gave a child 10k in cash - which they then paid into their account. Whose to say they hadnt been stuffing it under the mattress themselves for years?

Lender's ask for evidence of savings, i.e monthly or historic bank statements. I know for a fact a major UK lender does not like gifted deposits. Also the source of funds declaration if answered incorrectly or lied upon is an act of fraud "obtaining money through an action of deciept or dishonesty" this is also checked by your solicitor.

So when asked sources of deposit and savings is ticked, this could be checked by the lender and a CIFAS marker added to the declined application is deemed to be incorrect. Very extreme worst case scenario granted, but OP asked if it was possible, so the answer is yes.

Again, not being troll like just letting you know how some, not all, lenders view this situation.