Gifted deposit - need advice please!!

(17 Posts)
faffalotty Thu 04-Aug-16 13:43:41

My parents are helping me out with buying a house - I'm buying my first house on my own (divorce) but I'm not a first time buyer. The money is a gift, they are not lending it to me. i'm also using equity from family home and a mortgage (agreed in principle).

I had thought that they could just pay the money into my account and then I would pay it wherever it needs to go on completion. However, on the documents from the solicitor they are talking about gifted deposits and wanting to see evidence of the money and ID. I think this may also be a factor with getting a mortgage?

So do I have to declare this all as a gifted deposit, are there any potential issues with doing this? My parents do not live locally so can't just pop in to the solicitors with ID and I don't know how they will feel about providing evidence of the money.

A quick google seems to refer to gifted deposits as being a 10/20% deposit for first time buyers which doesn't apply to me.

I'm trying to get the sale through as quick as possible and was going to take documents to the solicitors today.

Can anyone offer any advice please?

PolterGoose Thu 04-Aug-16 13:56:47

Our last purchase dp's parents gifted us money, we just needed a signed letter from them confirming it was a gift and not to be paid back. We weren't asked to evidence where their money came from, but this might have tightened up.

Nervybuyer2016 Thu 04-Aug-16 13:57:54

Yes that's correct, it's for money laundering purposes iir. They will need to sign a letter to say it's a gift And have no interest in the property. Out broker verified parents ID. Hth!

faffalotty Thu 04-Aug-16 14:00:14

ok, thanks that doesn't sound too onerous. So the solicitors and the bank will probably have a standard form for them to complete?

Scribblegirl Thu 04-Aug-16 14:04:29

Yep, our solicitor had standard wording. It was just:

FAO: [bank name]

We, [Dad name and mum name] hereby gift [amount] to [our names] for the purchase of [property address].

We confirm that we will have no interest in the property following this gift and the subsequent completion of the sale.

[signatures]

Good luck!

liquidrevolution Thu 04-Aug-16 14:06:18

Yup I had to get this done when my parents gave me some money towards deposit.

Just a letter which I scanned and sent through. They didnt even want to original.

MovingOnUpMovingOnOut Thu 04-Aug-16 14:07:09

We did this a year ago. The solicitor needed additional documents to evidence the money wasn't laundered. Quite right too.

So as it was my parents they had to provide evidence of where they money came from (some sort of endowment payout I think), where it went (bank statement) and then I provided evidence it had come to me (my bank statement showing transfer). My parents were also required to write a letter from both of them (because the money had gone via a joint account - I think this was slight over kill as they were each entitled to spend anything they liked out of a joint account with either signature) confirming it was a gift*. They also had to provide their own ID to prove they were them. They did this by getting a local solicitor to make notorised copies of passports and driving licences and sending this to my solicitor.

It was only a massive faff because my solicitor didn't bloody read anything until the day before exchange and then decided he needed something different to what was provided due to old style driving licences and just one signature on the letter. That was a pain but entirely due to his incompetence.

*Technically it's a loan because I'm going to pay it back but that was going to cause problems with the mortgage company so my parents <ahem> "gave" us the cash.

MovingOnUpMovingOnOut Thu 04-Aug-16 14:07:45

Your solicitor should give you the wording to use.

Iamdazedandconfused Thu 04-Aug-16 14:10:07

For the ID, if your parents can drop into a solicitors firm that is local to them, their local solicitors should be able to certify their ID and forward the certified copy to your solicitor smile

faffalotty Thu 04-Aug-16 14:12:36

Thank you for all the replies

Regarding the mortgage - I'm thinking I should gt this letter sorted before I go to the appointment at the bank? it's so difficult to get hold of somenoe to ask - not like the old days when you could actually phone directly into a branch!

ImYourMama Thu 04-Aug-16 14:16:19

I'm a mortgage adviser- all this means is you need a letter from your parents saying 'this is a gift and we do not expect to be repaid' / the solicitor will want their ID for anti money laundering smile nothing to worry about and won't affect the mortgage

faffalotty Thu 04-Aug-16 14:20:15

Thanks - so the bank won't want any ID or evidence?

Pepsioften100 Thu 04-Aug-16 14:33:37

I just did this with my fiancé. Didn't need ID or anything just a letter saying gifting for purchase of house and no repayment expected/not a loan. smile everyone was happy with that.

ImYourMama Thu 04-Aug-16 14:41:12

Just a letter stating the gift smile

YelloDraw Thu 04-Aug-16 15:10:07

As everyone else has said - totally normal.

Just a signed letter saying "I [name] am gifting [your name], my daughter, an amount of £[x]."
You'll need that for mortgage pffer and also solicitors.
Solicitors will also need ID - but they probably don't need 'certified ID'. So a photo of driving license will be fine.
Solicitors will also want a copy of your parents bank statement showing the to be gifted amount.

YelloDraw Thu 04-Aug-16 15:10:37

Thanks - so the bank won't want any ID or evidence?

Bank won't, just the letter.

Solicitor will as per my post above :-)

kirinm Thu 04-Aug-16 15:37:08

We've just done this. I googled the wording and sent photocopies of MIL's passport and driving license for ID purposes.

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