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Loan to sibling for house purchase deposit....
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If you try to tie the loan back to an equity share of the property HMRC could deem that a chargeable consideration meaning SDLT (LTT if you’re in Wales) is due.
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You can’t rely on anyone writing anything in a will, wills can be changed and they may not have the money in their estate when the time comes.
If you aren’t willing or can’t afford to gift it, then don’t do it. Anything you do do will be at the expense of your kids future inheritance.
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Your first problem is that a mortgage company will not accept a loaned deposit. You must also assume that this money will not be paid back to give it you can afford, and are prepared to, to write it off.
The general wisdom is that friends / family and money do not mix so I would avoid lending them the money.
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