Deposit from parents house sale

meriah

Hello all looking for a little advice.

Myself and my partner are first time buyers. We have a mortgage in principle in place based on a £60k deposit. Some of this money is cash in savings accounts, however a portion is due to come from the sale of a property belonging to parents. This house sale is quite progressed, and we have a provisional moving out date of 7th July. When this is completed, they will be giving a portion to us towards a house.

I have spoken to our mortgage broker about this and he has suggested that when making an offer on a house we do not need to mention to the estate agent that some of the money is coming from this house sale, as the property is not ours. He has suggested that as it is due to go through in less than two weeks we will be able to delay somewhat if an offer is accepted on a house. However in the event that the house sale fell through, this would mean we would most likely need to retract our offer.

I am not really sure what is the best thing for us to do, I don't really think of us as 'in a chain' as such. Should I be upfront with the estate agent now, explain how progressed the sale is, or should I just not mention this house sale at all when making an offer? As it is not our property that is being sold.

Any advice would be very much appreciated. Thanks.

foxy-stoat

Just carry on as normal, no need to give the Estate Agent any information but I wouldnt spend any money on searches/surveys until you have a firm date when you will get your full deposit.

hazyjo

Presume they are gifting it, not lending it to you?


I'd not mention it to the EA either. You can use any reason for retracting your offer if it all fell through. You don't need to go into the ins and outs, just say 'a cash gift has unfortunately had to be withdrawn for the time being'. End of conversation.

meriah

Yes, they are gifting it not a loan. Thanks for the advice!

jennhg88

As others has said, isn't a concern of the EA. As a gift it should work out. Good luck!

eddddy

This is always a contentious topic - but once an offer is accepted, many EAs will ask to see a bank statement as proof that you really do have the deposit.

The (mandatory) Code of Practice for Residential Estate Agents says:

10. Financial Evaluation

10a At the time that an offer has been made and is being considered by the seller, you must take reasonable steps to find out from the buyer the source and availability of their funds for buying the property and pass this information to the seller. Such information will include whether the buyer needs to sell a property, requires a mortgage, claims to be a cash buyer (*) or any combination of these.

https://www.tpos.co.uk/images/documents/rules-codes-obligations/residential-estate-agents/TPOE27-6_Code_of_Practice_for_Residential_Estate_Agents_A4_-_effective_from_1_Oct_2016.pdf

EAs do these checks because, weirdly, some people do make offers on properties when they don't really have the means to buy them.


FWIW, I recently accepted an offer on a property. When the EA asked to see proof of deposit, the buyer started making excuses, and eventually stopped taking calls from the EA. After about 3 weeks, we concluded that they were just time-wasters.

hazyjo

eddddy wrote: »

This is always a contentious topic - but once an offer is accepted, many EAs will ask to see a bank statement as proof that you really do have the deposit.

Just say some of it's gifted if they ask. Don't need to say it's dependent on a sale. Am sure the broker would back this up with a letter/email.