Saving for buying first home

vheidar

Hi,

My wife and I (both working) intend to buy our first home toward the end of this year and try to save as much as we can for it. We have been given a gift by our parents (from another country), but it is not that much money that is really worth the hassle to provide the source of funding for the house purchase purpose. But, we thought we might be able to save a bit more if we can use that for day to day expenses, rent, bills etc. The gift money is in a bank account different from what we use for saving money from our salaries. 

My questions are:
1) Would there be any issue (for solicitor and mortgage lender) with not spending from our salaries for living expenses, rent, bills etc (saving almost the whole salary)?

2) Do we need to provide a statement from the gift money bank account when we do not use the gift money for buying house?

Thanks in advance for your time.

Exodi

As you need to detail expenditure in your mortgage applications - you are forced to either lie that you pay 0 for rent, 0 for bills, etc (obviously not recommended as this will obviously be challenged) or state what you pay towards them, then inevitably have the lender query why there are then no rent or bill payments showing on the statements you provided.

Personally, I think you should just go down the normal route - expect your parents will be required to fill out a 'gifted deposit' declaration (where they state the expect nothing in return) and that your parents are likely to be asked for statements for the account they sent the money from.

If the money is that insignificant, why not have them gift it after you buy the house? EDIT: sorry, just re-read that it's already been transferred. What is the value? If we're talking less than 1 thousand pounds, I doubt the lender/solicitor will even care.

newsgroupmonkey_

Exodi said:

As you need to detail expenditure in your mortgage applications - you are forced to either lie that you pay 0 for rent, 0 for bills, etc (obviously not recommended as this will obviously be challenged) or state what you pay towards them, then inevitably have the lender query why there are then no rent or bill payments showing on the statements you provided.

Personally, I think you should just go down the normal route - expect your parents will be required to fill out a 'gifted deposit' declaration (where they state the expect nothing in return) and that your parents are likely to be asked for statements for the account they sent the money from.

If the money is that insignificant, why not have them gift it after you buy the house? EDIT: sorry, just re-read that it's already been transferred. What is the value? If we're talking less than 1 thousand pounds, I doubt the lender/solicitor will even care.

Without lying, what if you simply told the solicitor that your parents had decided to pay your bills for a few months?

Surely they could argue that the parents were simply helping them out with day-to-day expenses. Loads of parents do this (I know a guy whose parents have been paying his mortgage for years).

Sistergold

How much is the said gift? It might help for better advice. For example few thousands can be easily swallowed in daily living expenses like groceries and thus increasing what you can save from salaries over the next few months. Can also just keep aside for furniture if not that much? 

vheidar

Thank you all for your advice! It is around £9K which can cover several months of rent, shopping and bills really. But, on the other hand, don't want to do something silly that would affect my mortgage and purchase process for just this little amount of money. Would probably keep paying rent and bills and time to time shoppings from the main account just to be on the safe side. I am sure there would be many unpredicted expenses that I can use the gift for those ;-)