Feel like I’m in a right pickle!

Kirkii27

Basically I’ve had a mortgage approved. Before we applied for a mortgage we spoke to the solicitors and explained that my father in law is putting 40k towards the mortgage this is technically a gift as he doesn’t think he will ever need it (from a sale of a property he had) I’ve applied for the mortgage I did put gift down on the application form which I’m guessing is wrong now as the solicitor said they can write something up to say 40k is my father in law money but its not actually a loan we won’t be paying anything back... I’m going to ring the mortgage lender later. Do you think we will be declined now? 

Is there away around this? Or am I back to square one ? 

K_S

@Kirkii27 It isn't clear, is this a gift not not? If not, most lenders will not consider it as a deposit. Who's the lender? Didn't they require a gifted deposit letter?

Kirkii27

Santander is the lender. No they didn’t.

basically my father in law sold his house and is putting money into our house and his daughters (when she finds a property) so we can all get on the property ladder. My partners dad has said it’s not a gift but he doesn’t think he will ever need it back. Me and partner put gift as a deposit because his dad was putting it into the property. On the application iwe couldn’t put it as a loan imagine 40k as a loan but won’t be paying it back as we may never need to?? 

Would it be best his dad just going on the mortgage with him. Lower the terms of the lend which won’t be 25 years now as his dad in his early 50s 

ACG

There are lenders who will allow someone to gift the deposit but also take a charge against the property. I have no idea what Santanders stance is, there is a chance it could not be declined unless dad will say it is a gift. But in real terms you cant really say "here is £40k, but I might want it back". What happens if he asks for it back in 6 months time? Where are you going to pull £40k from? 

Kirkii27

Would it be possible for my partner and his dad to get a mortgage together? We really want this house! 

Windofchange

It would all depend on how the finances stack up. If your partner's dad is over 50 then you are on dodgy ground - mainstream mortgages need to be paid off by the time the oldest borrower turns 70 otherwise you are into non-standard territory. Would his dad pass affordability checks - i.e they will want to assess how much he earns just as with yourself or anyone else. I would imagine by far the simplest thing to do is for him to declare it as a gift - is there a reason this can't be done? If he won't sign a letter to say he never wants it back and has no interest in the property then as above you need to find a lender who will accept a second charge on the property which will likely narrow your options. 

chasingfreedom

Personally I would declare it as a gift as long as your father in law is prepared to sign a letter to say you are not obliged to repay it. Sounds like it unlikely he will want it back but whatever you decided to do later on and if he decides he wants it back is up to you. If he's not prepared to sign the letter you will have to declare it as a loan instead and they'll want to know what the repayment agreement is and take that into account for your affordability. Maybe you just say you are paying back 100 quid a month or something? Santander are one of the few lenders who actually will allow you to have a loan for your deposit as long as its within their affordability criteria.

ukri

OP, with all these flakey explanations, you are likely to confuse or scare off the bank and/or the solicitor.

if you go on to draw a blank with Santander, use an MB the next time around, you really look like someone who needs solid advice and hand-holding.

Aspiration

We had something very similar with Santander. 

Processed it as a gift.

After a couple of months got the solicitor to draw it up as a secured loan after the banks mortgage was taken first as they obviously took priority.