Nationwide - Financial gift from parents

Cleverclogs

Husband & I are FTBs and have our mortgage offer from Nationwide. We've saved approx £12k to cover deposit, fees etc. My dad has kindly offered to help us with stamp duty as we have a small shortfall (approx £1,300). Stupidly, I didn't think to mention this to solicitor as we only had to provide proof of funds for our deposit which has all been done. Anyway, I've now spoken to the solicitor as we are getting ready to exchange - and I need to get the required paperwork from my dad (letter stating a gift/certified ID/bank statements for proof of funds) - which isn't a problem. And our solicitor has said once that's all done, he is required to tell Nationwide about the 'gift'. I'm awaiting a call back from Nationwide to clarify, but does anyone know what Nationwide's policy is to 'gifts' and whether this is likely to affect our mortgage offer?

Thrugelmir

A sum as small as £1,300 is unlikely to pose you any problems. The formalities need to be completed whatever the sum involved.

holly_hobby

As long as its made clear the monies are not acting as a gifted deposit (due to beneficial interest issues), but instead parental assistance solely with SDLT costs, there shouldn't be any underwriting issue.

Hope this helps

Holly

Cleverclogs

Thank you for your replies. That's really helpful. I think anxiety levels are increasing as we approach exchange. I'll breathe a sigh of relief for now & keep my fingers crossed.

holly_hobby

Yep, stressful old thing buying houses (well that and when someone's sneaked the last jaffa cake )

Here if you need us Clogs x

Holly x

Cleverclogs

Thanks. One thing's for sure, I won't be doing it again in a hurry!

Cleverclogs

As everyone has been so helpful (thank you!), just as a follow up to my previous post - we pulled together all the paperwork, sol has passed to nationwide, they're happy with the gift and we're approaching exchange hopefully next week (but I'm not counting my chickens).

However, on the completion statement I've just been sent, we're now being charged for a 'gift indemnity policy' at the sum of £111.05. I don't want to quibble but 'look after the pennies...' and all that! Obviously I've queried this with sol (but guessing he's already hit the pub/golf course *rollseyes*) but does this sound legitimate?

holly_hobby

Its in case your parents are later made bankrupt, and the receiver puts a claim on the gifted monies under deprivation of assets (DOA).

Its absolutely nothing to worry about, not all Solicitors are requested to (by the lender) or choose to effect such an indemnity policy, but many do, to rightly protect themselves in such an event - unfortunately the cost is always bourne by the individual (not the Sol) and if they want one there's no room for negotiation with them - it is what it is I'm afraid !

Hope this helps ... completion goes smoothly and you all enjoy your new home !

Holly xx

Cleverclogs

Thanks Holly. I suspected it was to protect the lender, but for a £1300 contribution to SDLT, it's annoying we have to pay it! I can't be bothered to fight it so we'll suck it up, pay it & remember to avoid this next time.

holly_hobby

Yes, will be easily avoided if you don't have a gifted element on your next purchase.

Hope all goes well ....

Holly x