Mortgage gift deposit

niac

Can anyone help!

We have just sold Our house and found another property! Our Mortgage has been accepted but in The meantime my parents have sold their house (cash sale) and would like to move into our new house with us (annex).

We are wanting to use their cash £110k as a deposit on our new mortgage. Problem is we have not mentioned any of this to the mortgage company as its only just come about. We Dont want joint mortgage. Do we have to declare to the mortgage company that they will be living there?

Would it be as straight forward as drafting up a letter through a solicitor agreeing that if anything happens in the future that we would pay back their £110k?!?


Thanks in advance

ViolaLass

If they want it back, it's not a gift.

niac

Any ideas How can we get around them using their £110k towards mortgage? ��......Not as a gift?

davidmcn

You will need to find a lender who will be happy both with the gifted deposit and the fact that your parents will be occupying (which may be tricky as lenders generally don't want the donor of a gifted deposit to claim any interest in the property, and the fact it will be their home makes that sound dubious). Probably one for a broker.

Thrugelmir

niac wrote: »

Would it be as straight forward as drafting up a letter through a solicitor agreeing that if anything happens in the future that we would pay back their £110k?!?

The problem for the lender is that the "gift" and subsequent occupation of the property construes further rights.

The lender needs to be aware of your plans sooner rather than later.

AnotherJoe

niac wrote: »

Would it be as straight forward as drafting up a letter through a solicitor agreeing that if anything happens in the future that we would pay back their £110k?!?

You can be absolutely sure that something will happen in the future so you need to be a bit more specific about the "anything"

When I paid a large deposit for my daughters house, which was not a gift but a loan that didn't need to be repaid until the house was sold, I had to sign that I would not be living there. So this may be problematic. I'd say you definitely need a broker.

Brock_and_Roll

To be honest, this sounds like an absolute legal minefield for any mainstream lender and their gut instinct will be to avoid it. Definitely need to contact a broker asap.

foxy-stoat

Just buy the property in the normal way keep your parents money separate and let them live there rent free.

If you want to pay chunks of money off your mortgage using your parents money once everything is set up then do so. Keep everything in writing between you/your other other half and your parents in case something happens in the future and they want/need their money back.

davidmcn

foxy-stoat wrote: »

Just buy the property in the normal way keep your parents money separate

Eh? They're (presumably) needing to use the parents' money to buy the house.

frugalsmurf

Have you arranged the mortgage with the intention of using your parents money?&them moving in with you?
Or have you found a house, arranged a mortgage on the house price and they've then offered the money&said they'd move in?

niac

We are using my parents money as a deposit on the house. We've spoken to HSBC today and they say there is no problem with them living with us!! We've also been into the solicitors and been advised to have an agreement written up between us regarding their rights of anything was to change in the future!!!!! Still a little confused but glad HSBC said it won't delay our mortgage.