Stages of buying a house - when is proof of deposit needed?

kinger101

Eyeonthesky wrote: »

So could I supply the proof of funds in someone else's account and a letter to say it will be gifted to me, and pass this onto my mortgage lender as proof of deposit for mortgage application? Therefore proceeding with application before April

I think this is what happens. The bank will probably require a declaration that the gift is unconditional and non-refundable, and that the person making the gift will not have any interest in the property.

I think your best bet is to find a bank that can give you a decision in principle then phone them up to ask about their procedure. Then if you do put any offers in, be frank with the vendor that the funds won't be available until April, so you cannot exchange contracts until then. You won't be attractive to anyone needing to complete before then, but come February, it won't make much difference anyway as exchange in under 12 weeks is rare even without a chain.

The vendor will want you to start surveys and legal work after accepting an offer, so I presume you have some money set aside for this?

Mrs_pbradley936

kinger101 wrote: »

Will a solicitor be prepared to confirm the vendor has the deposit just because they say they have?

They will ask for it to be placed in their "client account" i.e they have it but it is not for their use. They would have to pay it back less the cost of any fees if the sale did not take place.

penguingirl

We had a similar situation last year, although in our case we had 'nearly' enough from the equity in our sale and the mortgage to cover the new house, but we're sorry the last few K and the money for the fees. My parents agreed to gift us some money, but only transferred it the week prior to exchange. They had provided letters and proof of the money quite early in the process and it was a condition of our mortgage offer that this had bev reviewed. Personally, I'd start looking but not offer until about end of Feb/early March as I think longer tag 4 weeks is pushing it for vendors. Of course, when you view you may find some vendors are forming a chain and not in a rush, but I would think they'd be the exception

kinger101

penguingirl wrote: »

Of course, when you view you may find some vendors are forming a chain and not in a rush, but I would think they'd be the exception

They could always enquire about the chain position before the viewing. It's something I usually did when I was buying.

DaftyDuck

kinger101 wrote: »

Will a solicitor be prepared to confirm the vendor has the deposit just because they say they have?

Mrs_pbradley936 wrote: »

They will ask for it to be placed in their "client account" i.e they have it but it is not for their use. They would have to pay it back less the cost of any fees if the sale did not take place.

No, not at all. The solicitor might (should) ask for proof the funding does/will exist, but for proof of funding you most certainly won't have to deposit the cash, no more than you would if you gave the agent proof of funding.

Showing the solicitor your bank statements, the statements of your rich uncle, your last-week's winning Lottery Ticket, as yet unclaimed but worth several million, or a suitcase full of used fifties; all these will satisfy a solicitor that you have the funds, and he will validate your offer to the estate agent. He will simply state: "My client has sufficient funds to go ahead with the purchase", and won't entertain any nonsense about visiting their in-house mortgage advisor... who will inform the e.a. that your Uncle/Lottery Win is worth billions/millions.

I've been a cash buyer for years. I drive a beaten-up car, and look more Compo than Cosmo. I always give financial details to my solicitor, never to an estate agent. That way, I can just... only just (but comfortably just) afford the price we finally agree on. Just...