Deposit - Parents Gift

guysl80

Dear all,

I am planning to buy my first property in UK and my parents will be supporting me by sending a large amount of money from abroad so I have a substantial deposit.
If this is the case what sort of documents do i need to prove that this money is sent to me by my parents and its purely act as a deposit to purchase a property in UK.

Thanks in advance

amnblog

That depends where is it coming from. If, for example, Iran, there would be an issue due to current sanctions.

muhandis

When we got a Nationwide mortgage where the deposit was partly made up of gifted funds from abroad (non sanctioned Non-EU country), my broker asked for two things -

1. Nationwide gifted deposit form which had to be signed by the relative who gave us the gift (our broker was happy with a scanned copy).

2. A letter from them stating the source of the funds, that they are gifting it to us and that they will have no rights to the property. Again, a scanned copy was fine.

It was fairly straightforward in our case though I have seen the odd thread in the forum where lenders ask for overseas bank statements showing proof of build up of funds etc.

Nothing to overly worry about, this is very common in London and the SE so lenders, brokers, solicitors are very well versed with the documentation required.

guysl80 wrote: »

Dear all,
If this is the case what sort of documents do i need to prove that this money is sent to me by my parents and its purely act as a deposit to purchase a property in UK.

davidmcn

Aisde from whatever the lender needs, your solicitor will require evidence of the source of funds for anti-money-laundering purposes - so ID for parents, bank statements going back x months, and a paper trail for the transfer to you. No standard requirements so you'd be best to ask your solicitor what they'll need.

muhandis

Not necessarily. We didn't need any of that, just the same gift letter that we provided to the broker.

davidmcn wrote: »

Aisde from whatever the lender needs, your solicitor will require evidence of the source of funds for anti-money-laundering purposes - so ID for parents, bank statements going back x months, and a paper trail for the transfer to you. No standard requirements so you'd be best to ask your solicitor what they'll need.

davidmcn

muhandis wrote: »

Not necessarily. We didn't need any of that, just the same gift letter that we provided to the broker.

In that case I'd start worrying about what other corners your solicitor was cutting.

muhandis

Considering we've had the house for a few years now, he's still around, still on the panel for all mainstream lenders and gets referrals from one of London's largest mortgage brokers, I'd say not many

davidmcn wrote: »

In that case I'd start worrying about what other corners your solicitor was cutting.

Having said that, different solicitors will have different internal compliance requirements to satisfy their obligations under AML laws, and so might require more/less/other evidence.

kingstreet

The right answer here is whatever YOUR lender and YOUR solicitor require. There is no "one size fits all" approach, so I would not make plans and arrange documentation based on the responses you get on here...

Thrugelmir

muhandis wrote: »

Considering we've had the house for a few years now,

How many years ago. Regulations are constantly changing to keep up with global events.

guysl80

We received half ot the money few days ago and the rest within 2 weeks time. Used some of that money to pay of the debts we have but still a considerable amount of money left in the account.

1) Does this money have to be in the account for a certain period of time before apply for a mortgage?

Cheers

muhandis

No it doesn't, you can use it straight away towards your deposit. As discussed above, you will need to satisfy any specific evidence requirements as required by the lender and your solicitor.

guysl80 wrote: »

We received half ot the money few days ago and the rest within 2 weeks time. Used some of that money to pay of the debts we have but still a considerable amount of money left in the account.

1) Does this money have to be in the account for a certain period of time before apply for a mortgage?

Cheers