Concerning

Blotto17

So my mate is getting a mortgage with his partner. He’s put up most of the deposit and she has topped it up with 40K. However she doesn’t want to be on the mortgage as it would slow things down now that he has got so far into it on his own. However the lender wants to know where the deposit came from inc the 40K and they are saying whoever has contributed towards the deposit is not allowed to live in the property. 

Apparently there’s no reason listed for it, it’s just part of their terms and conditions.  If he tells them that someone has given him a gift of the money, they then won’t proceed with the mortgage if he wants the same person to move in. 

The broker has advised just to say it is a gift and that he would be living on his own. But she could just move in afterwards. Is this risky? 

Would it just be forgotten about come the time when contracts are exchanged and keys are handed over 

user1977

Does his partner want to sign something which means she waves goodbye to her £40k?

Why would it be so complex to make it a joint mortgage application? Why weren't they doing that from day one?

Blotto17

Just because he had more money and they thought it would be more straight forward. She is happy to top up the mortgage. She knows what kind of person he is. He wouldn’t shaft her no matter what happens. They have seen a place they really like and don’t want any further delays (there have been already for other reasons) and they just want to get on with it. Otherwise they would have a joint mortgage 
its just this issue is nagging at them now 

user1977

Blotto17 said:

Just because he had more money and they thought it would be more straight forward.

Well, now they know it's considerably less straightforward. So they should make it a joint purchase. Assuming they actually want our advice.

Blotto17

Well sure. I understand the main advice that is given is joint mortgage. 

But if going ahead and doing what they plan to do in my original post…..are the lenders really gunna chase them over it? Is it possible for there to be repercussions? 

EssexHebridean

It would be mortgage fraud, basically. I’d strongly advise you…sorry, your friend….to just take the simple approach and make a new application for a joint mortgage. I’d even more strongly advise your/your friend’s partner not to even consider giving £40k to someone else without any security to show for it. (As she will literally as already pointed out, have to sign a gifted deposit letter confirming that it was truly a gift.) 

Hoenir

Blotto17 said:

The broker has advised just to say it is a gift and that he would be living on his own. But she could just move in afterwards. Is this risky? 

The mortgage broker should be fully aware of why. Concerning that this is the suggestion.  As potentially could lead the brokerage firm itself into seriously hot water. Lying is fraud. 

Apply for a joint mortgage. Job done . Though is there a reason behind why one party is reluctant to take this course of action. As matters stand there's no time saving just wasted time. 

Emmia

Going to be honest, if I was putting £40k into a property purchase I'd want that reflected in a legal agreement - things are great now, but what about next year, or in 5 years...?

As it is, she either signs a document saying it's a gift, (and if they split up she's got no recourse to claim the £40k back) or she goes on the property with a joint mortgage...  I don't understand the reluctance unless there's more to this ??

Blotto17

Well there is concerns she is on a zero hour contract 

LHW99

But surely if his income covers the amount they want to borrow (as it presumably does) her income at whatever level just adds to that. That used to be the way it worked in the old days - X times highest earner (first name) + some proportion of the lower earner (second name)

Hoenir

Blotto17 said:

Well there is concerns she is on a zero hour contract 

The mortgage broker presumably considers this to be an issue. With her on the mortgage application you cannot obtain the amount you wish to borrow.