Gifted deposit?

FilthyLuka

I'm looking to apply for a mortgage and have a significant deposit

This has been built up from a combination of savings and gifts from parents and grandfather over the past 5 years or so.

What do I do in terms of declaring or proving where my deposit has come from?

My grandfather died a couple of years after gifting me about 20k which was around 2012. His estate including this gift was worth less than 325k

My parents also gave me around 50k after they inherited from the same grandfather (so it was not direct inheritance from the estate)

this happened again in the last year where I received 20k from my parents after they inherited from another relative (again this was not direct from the estate so I assume this cant be classed as inheritance)

So how do I declare this to the mortgage lender and my solicitor

I thinks need to declare the money from my parents as gifted as I assume this cant be classed as inheritance? I would love to be corrected on this one thought. I would need a letter to confirm the gift to present to the mortgage lender and solicitors

Regarding the gift from my grandfather, as he has now passed I obviously cannot get a gift letter - do i need to declare this as a gift?

sivs

I would not mention where it came from as its been a year or so since they gave you the money.

I had to send the details of my deposit to my solicitor and she only want to see a 2 month statement showing the money in my account.

Hope this helps

FilthyLuka

thanks, but im aware that is a large amount and the lender or solicitor could ask for the source of funds to be demonstrated

Id rather not risk being declined or anything worse tbh

ViolaLass

Use a broker, they'll know what you need to say.

FilthyLuka

it looks like my chosen lender nationwide only requires 1 months statements for deposits over 50k


but im still concerned that the solicitor may need more

is there any major downside to declaring gifts/

Anzhelka

they definitely can request more statements later.

martinsurrey

FilthyLuka wrote: »

it looks like my chosen lender nationwide only requires 1 months statements for deposits over 50k


but im still concerned that the solicitor may need more

Is there any major downside to declaring gifts/

As you can show where they came from, no.

Your parents might get asked to sign a letter stating it was a gift, but that's it.

they just want to make sure
1) the money is legal
2) no one will end up with a beneficial interest in the house as they provided funds for its purchase.

davidmcn

FilthyLuka wrote: »

but im still concerned that the solicitor may need more

Then ask them what they will need. I would only look back 3 months, but there are no hard and fast rules.

AQAddict

is there any major downside to declaring gifts

I don't think there's any downside in declaring gifts. For some conveyancing quotes they bosh on an extra £100 fee for the privilege of handling a gift, but others don't, so worth declaring on that basis so you don't get caught out. I have £20k in my savings that was from an inheritance more than 5 years ago, which Nationwide accepted has been assimilated into my own personal savings.That might be the case with your inheritance from your grandfather.

I noticed on my DIP Nationwide asked for savings proof for just 1 month (over £50k), but then in the title of the document store (I'm applying online) it's headed 'Proof of savnigs deposit 6 months' - so who knows!

But a bigger gift from my mum to help buy a house (she gave it to me 2 months ago to get the IHT 7 years ticking down) is definitely a gift. Nationwide have asked us to fill out a Declaration of gift form (very simple), and as she's already given me the money, proof of it being in my account. Waiting to hear if they need anything else, but hopefully not. My solicitor has advised she may need to do a bankruptcy search on my mum.

But yes, I would say the easiest thing is to just tell your mortgage broker/lender and solicitor everything you've told us, and they'll work it out. You go into these things thinking it'll be really complicated, you must be the only one with this set of circumstances, how can you possibly explain all these quirky circs, and then you realise they deal with these things day in day out.