Borrowing money for a deposit!

snowcat123

BoGoF wrote: »

So you're intending on submitting a fraudelent application then

Hypothetical questions. Sense the tone. No need to be over-dramatic!!!!!

Tixy

snowcat123 wrote: »

It could be declared as a gift, but as it's a close family member a gentleman's agreement could be made to pay back the money over time.

Absolutely do not do this. Its fraud and much too high a risk. If a family member is willing to lend you £25k, then maybe instead you could discuss if they would be willing to act as a guarantor, there are some specific mortgages around which allow people to act as a guarantor, or use equity from their own property to guarantee the additional borrowing in yours.
You'd and the guarantor would need to understand the implications (which can be very major for them) and then need to talk to an independant mortgage broker.

You'd also still only be able to borrow based on the usual multiples of your income so you'd perhaps need to look at cheaper houses (eg £200k rather than £225k (£200k mortgage & £25k deposit).

snowcat123

ReadingTim wrote: »

Yes, the family member would have to sign a declaration stating that it was a gift, and not a loan. Now, you could come to an unofficial arrangement about repaying that sum, but there's nothing to stop the borrower doing a runner and skipping the repayments, and there would be nothing the lender could do about it.

Given that possibility, I would suspect that there would be few family members willing to take that risk....

Thank you.

snowcat123

Tixy wrote: »

Absolutely do not do this. Its fraud and much too high a risk. If a family member is willing to lend you £25k, then maybe instead you could discuss if they would be willing to act as a guarantor, there are some specific mortgages around which allow people to act as a guarantor, or use equity from their own property to guarantee the additional borrowing in yours.
You'd and the guarantor would need to understand the implications (which can be very major for them) and then need to talk to an independant mortgage broker.

You'd also still only be able to borrow based on the usual multiples of your income so you'd perhaps need to look at cheaper houses (eg £200k rather than £225k (£200k mortgage & £25k deposit).

Thanks. I'm a newbie to all this and thought I'd fire as many questions as possible to cover all angles.

Naturally, I want to have a mortgage free of any wrongdoing.

There's some good advice and knowledge here - I appreciate your responses.

snowcat123

BoGoF wrote: »

Sense the tone??? Would that be the tone of someone seemingly desperate enough to do anything to get on the 'housing ladder'.......

I think you're rather rude frankly.

EKAndrew

hi snowcat - i don't think BoGoF is intentially being rude - probably just "blunt"
you mentioned that you are a newbie, but if you read other sections of this board, there are mulitple posts on the situation you have "hypothetically" mentioned where people have lost out severely. this place of people who have had financial problems after getting a massive mortgage and you are taking a big risk, would it not be possible to buy a smaller place if you desperately want on the housing ladder?
you also mentioned that you can get a 200k mortgage............that doesnt mean you have to take a 200k mortgage!
MSE is full of helpful and informative advice
good luck whatever you choose to do, just make sure you think it through thoroughly

Gordon_Hose

Reminds me of when I bought my 1st house with my now ex. We had a chat with the estate agents mortgage advisor.

No word of a lie, he told us to use credit cards to bump the deposit up.

Needless to say we walked out. Shocking "advice".

Anyway, plenty of people take "gifts" from parents etc to be able to afford their 1st home, so I don't see why a gift from a family member would make any difference.

talana

Gordon_Hose wrote: »

Anyway, plenty of people take "gifts" from parents etc to be able to afford their 1st home, so I don't see why a gift from a family member would make any difference.

I fall into that group myself. My deposit for my first home was a gift from my parents. A few years down the line when I sold that house and moved on I gifted it back to them.

Nothing wrong with a gift from family provided everyone knows where they stand.

Gordon_Hose

talana wrote: »

I fall into that group myself. My deposit for my first home was a gift from my parents. A few years down the line when I sold that house and moved on I gifted it back to them.

Nothing wrong with a gift from family provided everyone knows where they stand.

Exactly! I don't know what all this talk about fraud is for, but there are a lot of people, like you, and my girlfriend (who I live with), that have received gifts solely for payment of deposits on houses, and fully intend to give the money back. The bank won't ask where the money came from.

Tixy

Gordon_Hose wrote: »

The bank won't ask where the money came from.

Quite a lot of people are asked where the deposit is coming from. And if told its a gift in some cases are asked to show something to confirm its a gift (a signed statement by the family member).

Quite a lot of instances of this happening across the forum.