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Loan repayment from parent considered gift

chedpit
chedpit Posts: 5 Forumite
in House buying, renting & selling
Hi


In the process of purchasing my first home. I've saved up loads of the years but in the last 2 years my father got into serious financial difficulty with his divorce. I agreed to support him financially through the process since I had the money up front but we agreed that once he came into money again (e.g. selling the house they both owned together) he would pay me back.



He has not given me the full sum back so I've pressed on with my house purchase.



So my solicitor says that the money he paid back to me (several thousands) is considered a gift and therefore I need to pay them a few hundred pounds extra to deal with that. Obviously frustrated as to me it is "my money" and I've all the statements that show the money going in the other direction to my father.



My father will happily provide his ID, a letter explaining what the money is for along with his own bank statements.



Do I have any case here for not paying their charges?



Thanks

Comments

  • AdrianC
    AdrianC Posts: 42,189 Forumite
    First Anniversary Name Dropper First Post
    If you've got compelling paperwork to show it's not a gift to you (as a large transfer from parent to child usually would be), but is actually repayment of a loan the other way, then simply provide that to the solicitor.
  • chedpit
    chedpit Posts: 5 Forumite
    Thanks for the reply.



    So if I can show statements showing the originally the sum went the other direction you would think that would suffice?
  • AdrianC
    AdrianC Posts: 42,189 Forumite
    First Anniversary Name Dropper First Post
    chedpit wrote: »
    Thanks for the reply.

    So if I can show statements showing the originally the sum went the other direction you would think that would suffice?
    Ask the solicitor what they find compelling. But I'd not have thought statements alone would be sufficient.
  • chedpit
    chedpit Posts: 5 Forumite
    Ok thanks. Outlook not that good then :(


    I've just got statements showing the money in the other direction.



    What about this scenario then with some simple numbers to make the point?



    Let's say my father has returned £5000 to me and my deposit will be £20000. I actually have in excess of £25000 in my accounts so the money being returned isn't being used. In fact I could happily return the money to him, purchase the house and then have him return it to me after?
  • davidmcn
    davidmcn Posts: 23,596 Forumite
    Name Dropper First Anniversary First Post
    chedpit wrote: »
    Let's say my father has returned £5000 to me and my deposit will be £20000. I actually have in excess of £25000 in my accounts so the money being returned isn't being used. In fact I could happily return the money to him, purchase the house and then have him return it to me after?
    Yes, that would be fine. But is that the scenario here i.e. do you have enough money without your father's cash being there?
  • payless
    payless Posts: 6,957 Forumite
    Name Dropper Combo Breaker First Post First Anniversary
    my solicitor says that the money he paid back to me (several thousands) is considered a gift and therefore I need to pay them a few hundred pounds extra to deal with that. /

    Why
    Any posts on here are for information and discussion purposes only and shouldn't be seen as (financial) advice.
  • Bossypants
    Bossypants Posts: 1,273 Forumite
    First Anniversary Name Dropper First Post
    chedpit wrote: »
    Hi


    In the process of purchasing my first home. I've saved up loads of the years but in the last 2 years my father got into serious financial difficulty with his divorce. I agreed to support him financially through the process since I had the money up front but we agreed that once he came into money again (e.g. selling the house they both owned together) he would pay me back.



    He has not given me the full sum back so I've pressed on with my house purchase.



    So my solicitor says that the money he paid back to me (several thousands) is considered a gift and therefore I need to pay them a few hundred pounds extra to deal with that. Obviously frustrated as to me it is "my money" and I've all the statements that show the money going in the other direction to my father.



    My father will happily provide his ID, a letter explaining what the money is for along with his own bank statements.



    Do I have any case here for not paying their charges?



    Thanks

    Even if it were a gift, what could he possibly need to do about it which would cost hundreds of pounds in fees? It's not likely to be money-laundering checks, because he'd have to do those regardless of where the money came from. I would challenge him to break down exactly what those hundreds of pounds are going to cover.
  • poppy10_2
    poppy10_2 Posts: 6,575 Forumite
    Name Dropper First Post First Anniversary
    Yeah, no way the solicitor should be charging that much for routine checks
    poppy10
  • davidmcn
    davidmcn Posts: 23,596 Forumite
    Name Dropper First Anniversary First Post
    Bossypants wrote: »
    It's not likely to be money-laundering checks, because he'd have to do those regardless of where the money came from.
    They'll have to do moneylaundering checks on the funds coming from the OP, yes, but also have to duplicate them in order to check identity and source of funds for dad too, as well as get a gift letter signed by dad, check with the lender that they're expecting a gifted deposit, and apparently spend time debating with the OP whether it's a gift or a loan... So there's certainly additional work involved compared with a standard transaction.
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