Gifted deposit(7 Posts)
Me and my husband applied for a mortgage with Nationwide and we received the offer approximately 6 weeks ago. We filled in a gifted deposit form from them and 3 weeks ago our solicitor got my husband's parents to send a letter about the gifted deposit.
We are waiting to exchange and my solicitor said we are waiting on a decision from Nationwide about the gifted deposit. He says this is standard, but I thought everything was about to go through! What decision would they need to make when we already have an offer? Does anyone have experience of this?
They need to verify that you will definitely have the money from your husband's parents available in time to pay for the house and that his parents don't have any right to get the money back at any later point should you default on the mortgage.
It seems odd to me that this is happening a week before we are due to move. Although what you say makes sense, I wonder why they didn't check this when they offered us a mortgage? No one, incidentally, has asked me for any proof of the money... which has been in my account for 4 months!
When there is a gifted deposit they will check the affordability again to ascertain why you have not afforded to save your own, they may check with your parents that it is an outright gift rather than a loan and seek confirmation that the amount of the gift is not going to be subject to a charge against the property
Yeah that makes sense but as far as I was aware, that was done before the mortgage offer was made. All this house buying seems to be a series of odd processes. Thanks for your reply. I've googled and no one has talked about a decision this late in the game, but the two of you think it's normal so that is a slight relief. Thank you.
Perfectly normal in the conveyancing process for your solicitor to write/fax the lender advising them that there is a gifted deposit and requesting the lender to confirm that they are agreeable to proceed on this basis.
Obviously you have already advised the lender of this fact but not everyone does.
Since your solicitor also acts for the lender as well as you, they have a duty to advise the lender of any relevant information and can't just rely on your say so.
ex NW underwriter here.
gifted deposits can sometimes raise queries and if money is already in your account they could be just doing final checks. I would not normally do this so close to a move, however there were times when information was requested from legal teams who were late coming back with it. they may need proof of where the money came from (yours and gifters accounts) to add to the documents confirming it is an outright gift with no repayment.
rules have changed greatly since i left NW but most of these checks are to stop you either fraudulently claiming its a gift (which then turns out to be a loan making your offer unaffordable) or money laundering. they may be doing additional checks.
if you applied originally and the offer was issued before the gift was apparent then NW are working backwards to cover themselves and to make sure you are not overstretching yourself and making yourself financially vulnerable.
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