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Gifting a deposit - any tips
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horsewithnoname
Posts: 776 Forumite

I am in a position to gift a fairly substantial deposit to a friend for a house. What sort of thing should I expect? It’ll be a transfer from my account to their account, but are there any implications I should be aware of re money laundering laws or anything else?
It’s been decades since I bought a house so any help would be appreciated. My friend is a first time buyer, not sure if that makes a difference.
Thanks in advance for any help.
Just to add, I’m not trying to do anything dodgy, just help in providing a secure home for someone.
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Comments
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Is your friend getting a mortgage? Have they checked whether the lender will accept a gifted deposit from a friend?
The money laundering requirements are for their solicitor to explain to them, we don't know specifically what they'll be.3 -
Log on to bank account, transfer money, job done.
however....
If this gift is to be repaid then...
Log on to bank account, transfer money, make sure to have a proper contract in place, make sure loanee understands the implications of loan or put a charge on house, mortgage may be denied.
Pick one.1 -
Mortgage lenders tend to only accept gifted deposits from certain ‘types’ of people, usually close relatives. Your friend should speak to a broker to understand if they are likely to be able to get a mortgage with this type of deposit, or what their other options could be.
Re money laundering, the banks may well do checks at the time you move the funds. The solicitor will need to check source of funds as part of the conveyancing, and will likely need to see a paper trail of where the money came from in advance of you gifting it.1 -
TheJP said:Log on to bank account, transfer money, job done.
however....
If this gift is to be repaid then...
Log on to bank account, transfer money, make sure to have a proper contract in place, make sure loanee understands the implications of loan or put a charge on house, mortgage may be denied.
Pick one.0 -
Choirgrl said:Mortgage lenders tend to only accept gifted deposits from certain ‘types’ of people, usually close relatives. Your friend should speak to a broker to understand if they are likely to be able to get a mortgage with this type of deposit, or what their other options could be.
Re money laundering, the banks may well do checks at the time you move the funds. The solicitor will need to check source of funds as part of the conveyancing, and will likely need to see a paper trail of where the money came from in advance of you gifting it.No issues with the source of the money, it’s all traceable and above board.0 -
user1977 said:Is your friend getting a mortgage? Have they checked whether the lender will accept a gifted deposit from a friend?
The money laundering requirements are for their solicitor to explain to them, we don't know specifically what they'll be.0 -
If your friend is getting a mortgage the lender might send you a 'Declaration of gift' form. You might be asked to show the paper trail, as well as providing ID.£216 saved 24 October 20142
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youth_leader said:If your friend is getting a mortgage the lender might send you a 'Declaration of gift' form. You might be asked to show the paper trail, as well as providing ID.0
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horsewithnoname said:user1977 said:Is your friend getting a mortgage? Have they checked whether the lender will accept a gifted deposit from a friend?
The money laundering requirements are for their solicitor to explain to them, we don't know specifically what they'll be.
For this reason lenders are sceptical of gifted deposits from anyone who isn't a relative.
They will need to get a broker to ensure they go with someone who is okay with this arrangement.0 -
housebuyer143 said:horsewithnoname said:user1977 said:Is your friend getting a mortgage? Have they checked whether the lender will accept a gifted deposit from a friend?
The money laundering requirements are for their solicitor to explain to them, we don't know specifically what they'll be.
For this reason lenders are sceptical of gifted deposits from anyone who isn't a relative.
They will need to get a broker to ensure they go with someone who is okay with this arrangement.
a gift not a “gift” (loan); is there a register of mortgage brokers like there is IFAs?0
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