Newbie here .. Help needed please

nig246246

I have recently applied for a mortgage and the usual checks are being made by the lender. Last month I withdraw a sum of money from my child's account (she's under 5 and i'm a trustee) and put into my current account as part of my deposit. The lender advised that any deposit into my account may have to be explained to the underwriters... Please advise?:)

mrginge

How does your child feel about you stealing their money?

nig246246

I'm not sure it can be considered stealing as I put all the money in there myself.

mrginge

Ah ok, so it's just there as a tax evasion method then. Sorry my mistake.

nig246246

Tax has been paid on the interest in the account, it's not tax evasion.

Building_Surveyor

If your intention was to use your child's money (which presumably was intended for when they get older) to fund your deposit why was you saving this in the child's account in the first place?

StarGrabber

Wow! Super judgmental, no? We have no idea about the OP's circumstances. Furthermore, I think one of the greatest financial profit is for a child is family security and a roof over their heads (which they will hopefully inherit).

No practical advice, I'm afraid.

Building_Surveyor

StarGrabber wrote: »

Wow! Super judgmental, no? We have no idea about the OP's circumstances. Furthermore, I think one of the greatest financial profit is for a child is family security and a roof over their heads (which they will hopefully inherit).

No practical advice, I'm afraid.

Sorry but I don't for one second believe its a genuine post!

nig246246

Thanks very much

StarGrabber

Building_Surveyor wrote: »

Sorry but I don't for one second believe its a genuine post!

Fair enough. It was more mrginge's comment

Not sure of the practicalities. Technically, it would be a loaned deposit, even if it's coming from your child and I'm not sure how that would be viewed by lenders.

Yorkie1

You have to declare the source of the deposit accurately or it's mortgage fraud.

The issue with what you've done, according to how you've described it, is that the money is not strictly yours because it's in a trustee account and not an account in your name. As a trustee you have a legal duty to protect that money for the benefit of the beneficiary, and therefore as another poster has pointed out, you have a duty to replace the money you've taken from it. This does bring it close to the 'loan' situation but I don't know enough to say whether it has to be declared as one of the sources of the deposit.

I can understand why people are upset about this. If you've obtained a decent interest rate from the trustee account for your child, and then choose to use the money as you see fit for your wider financial purposes, then that does breach the trusteeship element of the account - you've essentially gained a higher interest rate on your own money by telling the bank that it's your child's money when in fact you don't treat it as such. If the interest is paid gross because it's a trustee account (assumption made here), then that is tax evasion if you in fact treat the account as your own.