gifted deposit

awolo1

Hi,

My mother has kindly offered to lend me some deposit required for a property I am looking to mortgage.

I wasn't and never planned on asking her to provide this money to me as a gift, however it has become a nessecity in order to please the mortgage lender, as I do not have enough of the funds at the moment to prove to them I have all the deposit.

(I'm a FTB and I was under the impression that I would have more time to get the funds together, and not so soon).

There is a short fall of a few thousand pounds.

The reality is, is that by the time I'm ready to send all the deposit over to the property developer, I will have by that time have all the funds myself (as Im only waiting on this months salary).

I have actually agreed with the property developer that I can pay the deposit in two parts (first in feb and remainder in march).

This means that I will actually not need the funds from my mother in the end...as I will have the funds myself...the gifted deposit is only there as security whilst I have this short fall.

Does my mother need to put this into the gifted deposit letter to make it clear, that I will more than likely have all the funds required, and that her offer will be redacted?

betmunch

awolo1 wrote: »

My mother has kindly offered to lend me some deposit required for a property I am looking to mortgage.

Firstly, is it a gift or a loan?

Assuming it is a gift, then use the term "up to" right before the amount of the gift and you should be fine.

awolo1

betmunch wrote: »

Firstly, is it a gift or a loan?

Assuming it is a gift, then use the term "up to" right before the amount of the gift and you should be fine.

gift, but it is 100% going to happen that I will have all the funds by the time the deposots are paid to property developer, so I won't technically need the gift from my mother, but I'm playing devils advocate here as the lender wants the proof. Worst case scenario which is that I don't have the funds, then yes, the gifted letter would still stand.

betmunch

awolo1 wrote: »

gift, but it is 100% going to happen that I will have all the funds by the time the deposots are paid to property developer, so I won't technically need the gift from my mother, but I'm playing devils advocate here as the lender wants the proof. Worst case scenario which is that I don't have the funds, then yes, the gifted letter would still stand.

Then add in up to what the gift could be and when exchange rolls around reassess how much of it you actually need.

Dont forget to allow for solicitors costs and all that

awolo1

betmunch wrote: »

Then add in up to what the gift could be and when exchange rolls around reassess how much of it you actually need.

Dont forget to allow for solicitors costs and all that

sure and when completion happens, deposits paid etc, I will be using my own funds anyway - if I tell this to thelender, etc, it won't be a problem?

betmunch

If you tell the lender the deposit is to come from your own funds then they will ask you to prove you have the funds at application
If you are offered the facility of a gift then you should tell them what you have available at the point of application and word the gift letter in such a way that you can take a smaller gift if need be.

awolo1

Do you think it's wise to put in a line of it being a conditional offer, that should I have my own funds by completion of the mortgage, that Ithe applicant reserves all rights to withdraw the gifted deposit offer?

betmunch

I don't think I can make this any clearer.