Using employer grant as part of deposit

waseem432000

Hi everyone, I posted this in the house buying forum a month or so back and only realised today that this is probably the right channel for this query. 

I am a skilled worker and will be eligible for for ILR in summer this year so will be applying in a few months. My employer, who has sponsored me and I have worked for them since I moved here, have recently offered that they can give me (a few others in my position) a one time grant to pay for the visa applications and I can get a specific amount of that deducted every month i work for them after ILR. Say I borrow £10k and they deduct about £500 a month as work contribution so if I switch my job and move on after 10 months, I will have to pay them £5k back. 

I have opened a LISA at end of the year and started saving for a deposit. I was planning to pay the visa fees from an interest free credit card anyway so can potentially add that £10k into my deposit. I just wanted to see if I am even allowed to do that in the first place? 

If I apply for a mortgage at end of the year, (say 6 months after grant so will have a £7k remaining debt), will I have to declare that loan £7k or complete £10k? 

MWT

waseem432000 said:

If I apply for a mortgage at end of the year, (say 6 months after grant so will have a £7k remaining debt), will I have to declare that loan £7k or complete £10k? 

I would suggest you talk to a mortgage broker, they can help you though the application process, but I would expect that you would have to declare the remaining loan amount and the monthly repayment you are making, and you would also need to declare the balance on your zero interest credit card.

Using funds from a loan as part of your deposit will reduce the number of lenders willing to give you a mortgage, so I'd suggest talking to a broker soon to assess if it is really helpful to take a loan you may not need, with the intention of adding it to your deposit...

ACG

It does not sound like a grant if you have to pay it back. 
You would declare the balance as it is at the time. You cant use a loan towards your deposit, You can with 1 or 2 lenders but your are reducing your pool of lenders to maybe 1% of the market. 

waseem432000

Thanks for the suggestions. I will definitely get in touch with a broker to discus this.