Any implications of regular cash deposits?

nickelfish

We bought a car from a relative with the agreement to pay for it at £500 per month. Are there any implications for him of us making these payments by paying cash into his account monthly? Literally taking cash out of our account at the cash point and paying into his back account at his branch?

Would someone question him about where it was coming from, or what it was for?

Thanks very much

jfh7gwa

If they do, just tell them it is to pay back an informal car loan i.e. the truth.

They can't stop you using the account and paying in like this unless they suspect fraud/money laundering. And for £500 a month I honestly wouldn't worry. I wouldn't think that level would trigger any warnings on his account - perhaps someone that works in a bank can confirm.

It wouldn't even enter my head to think it might be an issue though. Either you're too worried for nothing or I'm too naive!:D

talana

Why do it that way though? Why not just a monthly standing order set up online?

nickelfish

Thanks for your replies.

We have been paying by standing order but we are about to move house/apply for a mortgage and someone suggested to us that a regular payment like this might go against us (same bank acct/mortgage provider). Although it won't show on our credit score as not a formal credit agreement.

Something to think about anyway - thanks

agrinnall

Presumably you are not intending to tell your bank that you have this informal loan so that they don't take it into account when deciding how much you can borrow. Some might consider this to be fraud.

lolavix

I doubt very much they'd even ask about £500

rb10

The bank that you're applying for the mortgage from won't care that you have a £500 standing order on your account - just leave it in place like that.

You are unlikely to be able to withdraw £599 from an ATM in a day - most banks limit it to £300.