Gifted Deposits

drunkalarm

Hi,

I have a question around gifted deposits.

My parents have very kindly offered to get secured loan against their house to help with my deposit. This would be gifted to me rather than loaned.

I believe the solicitor will ask to see proof of where the money came from for money laundering purposes. Will this be a problem if they see it coming into my parents bank from the loan company even though I wont be paying it back?

Thanks in advance

sean_silva

I am more or less in the same boat as drunkalarm. So any expert advice appreciated.

According to my research, solicitors are protecting both lenders and buyers interest at the same time. If you mentioned about this gift deposit to solicitor, they will inform the lender. Gift deed letter is mandatory.

In addition to that, solicitor may ask for their IDs, previous bank statements to see define what's the origin of the money. As long as this is a genuine gift and your parents happily given to you and its being legitimate financial transaction, I don't think lender really mind.

However some expert please help us out.

drunkalarm

Hi,

I found this shortly after posting. So it looks like they can with no issues:

http://www.money.co.uk/guides/how-can-i-help-my-children-buy-their-first-house.htm

Scroll down to the "secured loans" heading. :j

sean_silva

That's a good one. Thanks for sharing.
Quick search gives me this, similar stories. Seems positive for us. :beer
h t t p:// forums.moneysavingexpert.com/showthread.php?t=5603256&highlight=gift+personal+l oan
h t t p://forums.moneysavingexpert.com/showthread.php?t=5515391&highlight=gift+personal+l oan
When we sign up for solicitor firm, they asked about this. Even before that we provided a gift deed declaration to the lender via our mortgage advisor. How about yours?

Whistler23

Can confirm the following.

My parents have done the same thing on a property they own. They have taken a loan out to gift us the deposit.

I sent the loan agreement and bank statement for my parents. Solicitors and lender were happy with this. If your parents are to pay the money over to the solicitor then they will need your parents ID - either call in to the office, or get it certified by another solicitor.

If your parents transfer the money to you and you then pay the solicitor, they will not need to provide ID.

Parents did have to sign the standard letter from the solicitors confirming it was a gift.

Oakdene

Should be ok, as mentioned about there will need to be a letter signed by your folks to say the money is not repayable...