House being repossessed and a gifted deposit is at stake

enthusiasticsaver

In most cases lenders these days ask people who gift deposits to sign a declaration to say they have no interest in the property and it is a gift and not a loan. The giver has no security and any repayment depends on the recipients willingness and ability to repay. 10 years ago lending practices were different and I don't think they asked for the deposit source.

Unless she holds a second charge on the property and there is sufficient equity to repay the mortgage plus arrears plus legal repossession costs she is unlikely to get anything back. Why on earth did your brother not put the property up for sale when they lost the lodger? This way it will be much more expensive as the mortgage holder will only be interested in getting enough to repay them so any equity in it will be lost and your mum won't see a penny.

Rich2808

If she has nothing in writing then all you or she can do is apply moral pressure on your brother to pay it back over time.

How much are we talking about - is it enough to adversely affect her retirement?

Amst

Of course it wasn't a gift, it's the only way these people can pass affordability checks by lying about the source of their deposit.

Unfortunately this sort of thing ends up happening which screws the donor and not the person who lied on the mortgage application.

davidmcn

Amst wrote: »

Of course it wasn't a gift, it's the only way these people can pass affordability checks by lying about the source of their deposit.

Unfortunately this sort of thing ends up happening which screws the donor and not the person who lied on the mortgage application.

Though to be fair, even if everyone had agreed it was a loan, mum would probably still be stuffed.

Amst

davidmcn wrote: »

Though to be fair, even if everyone had agreed it was a loan, mum would probably still be stuffed.

If they'd declared it to be repaid and applied a realistic repayment amount per month the mortgage may not have been offered and he wouldn't have ended up with a repossessed house :money: