To feel uncomfortable about this gift?

[nineofhearts]

I'll preface this by saying I feel really bad in feeling this way, but I just can't help it. It would be good to get some perspective.

In short, my dad has recently come into some money. My sister told me this weekend that he is thinking of gifting DH and I a house deposit.

This should feel really good (and I'm very grateful) but it actually makes me quite uncomfortable. Mostly because I feel like a gift of this nature sort of makes it unavoidable to disclose your financial situation, which I want to keep private.

My DH also has different ideas over how this money should be spent. For example, I think that if we aren't quite in a position to get the mortgage amount we want for our forever home, we should put the gifted money in an ISA or similar and wait a year or so until we've added more/more debts are cleared. He thinks we should use some of the gift to pay off debts then resave the difference with the money we are saving.

This also makes me uncomfortable. I feel like if we are given money for a house deposit, we should spend it on that, not debt. I also feel if we wait, it opens the door for us to discuss our financial situation in more depth (I.e why we aren't buying straight away). All in all, I just feel super uncomfortable with the whole thing to the point where I just don't want it, if he chooses to give it us. Which I know is ridiculous.

Please help me get myself out of this funk.

But not so much my debt, but DH's.

Which is what I suspected at the beginning of the thread. No wonder he wants them paying off with someone else's money.

To be honest, I'd have been furious with him for even suggesting that you use your dad's money for that.

There is a very simple solution. Tell your dad you appreciate it, you plan to improve your income within the next 2 years that will increase the amount you can borrow.
Tell your husband this is the gift for the house deposit and will be used for such, the debt to be cleared within 2 years using your income and you will be ready to buy then.
If he gets stroppy it might be a good indication that perhaps you shouldn't buy a house with him at all

Absolutely pay off your debts now!!! It’s false money when you owe so much. You’ll be paying more in interest- any financial advisor will tell you the same thing.

I agree with you, if it's gifted for a house deposit that's what it should be used for.

I don't think you need to disclose anything, it can easily take months to find the right house.

So your DH has lots of debt from before you met, so much debt that it's going to take you both years to pay it off, and he wants to use your dad's money to pay off his debts? Yeah, no.

That money is for a house deposit. If you buy 'not a forever' home you'll at least be on the property ladder and your equity and spending power will be pulled up higher by the rising market. So from a practical point of view buying an interim house is the right thing to do. You'll lose money every year by keeping cash in savings.

However, I would have a post nup agreement drawn up to ensure your higher contribution to the house is protected. Your DH is riding a real gravy train here. How would he have paid his debts off if he lived alone? He has 2 people's salaries paying them off now and it's still going to take years. Alarm bells are ringing.

Sorry I missed some of the previous posts before I posted the above.

As a parent I would be incredibly annoyed ( to put it mildly!) if I gave my dd and her dh money for a house deposit and it was used to pay off the dh's debts!!! And for your dh to suggest it's used for that is way out of line imo.

You don't need to go into great detail with your father but maybe explain that you have some debts to pay off before you can consider buying a house. You're both incredibly grateful for the offer and would love to take him up on it but could he bank it/invest it/keep it on hold for you for a year or 2 until you've sorted out your debts?

If it’s from your dad, you should choose what you do with it.

gifts with strings aren't gifts.

In general I'd agree with you. But I think a parents' gift of a deposit could absolutely come with strings. Even if it's just a single string.

I gifted both my daughters some money towards a deposit. The only thing I asked is that the deposit money was ring-fenced as theirs when they bought with their DH/DPs. I like their partners, but given the divorce rate, I don't want there to be the chance that their partner walks away with the money.

After reading your subsequent posts I think it would be wise to keep this money in your own account for now. Your DH needs to repay HIS debts he incurred married to someone else. Your Dad needs to know you’ll use it for a deposit once you are in a position to get a mortgage that’s all he needs to know. Do not pay off your DHs debts under any circumstances not matter how much he tries convincing you it will be beneficial in the long run.

The fact its your husbands debt, it pre-dates you, and he's the one who wants to use your dad's money to pay it off is worrying.

Its interesting your dad works in finance and you still never asked his advice on this. Are you sure you're entirely happy with your DH's approach to money now? I think it does depend a bit on how much money it is. In all honestly, in your position if your dad asks I would be tempted to say you have a few other financial commitments that mean you don't want to get on the property ladder for another year or two and would he hang on to it/invest it for you in that time? The fact your DH is divorced means him having some debts relating to that isn't insane, but if the issue is your father assumes you and your DH are financially responsible and in reality y our DH is in a lot of debt, it sounds like there's a bigger issue there.

I wouldnt be paying off your husband’s debt. What does that teach him? And I would be ringfencing the deposit too.

I can understand why your dhs priority is to pay off the debt. As you say that's what you are both working to achieve as a couple. I think if your dad genuinely wants to help you then you should be able to be honest about your financial situation with him. If he works in finance he should know that the best way to save money is to clear all debts first. If you cant share this information with your dad then I dont think its a good idea to get involved in something like buying a house with him. Isnt it better to just tell him we have some debts to clear but hope to do that within 2 years and then will be in a better position to get a mortgage. If your dad genuinely wants to help you then he needs to be understanding as well and shouldnt look down on you or your dh.

As a PP said, ISA in your name. It's clear what your dad is giving it for.

You don't have to tell anyone any financial details, they will trust you. In the unlikely event someone asks you why you haven't bought yet, just say you aren't in a position to yet, or mention the reasons if you want to.

People also made a good point that if it goes towards debts, there's always a risk your husband will let you pay them off and then leave you, wasting your dad's gift.

I'd talk to your dad (on your own) and explain the situation. If you accept the money now and even if you put in an ISA it's unlikely to be ring fenced in the recent of a divorce. However, if your dad keeps it until you need it, you can protect the deposit as a % of the house, ie you own 65% and DH 35%.

Alternatively see a solicitor/independent financial advisor for advice on this situation

The cheek of your husband to want to use your dad's gift to pay off mainly HIS debts. Truly selfish and I'd be pretty angry about this

agree with a PP that you should ring-fence this money for your house & not use it to pay DHs debts. Having your dad keep it safely for you until you are ready to buy might be good.

My In Laws gifted us £60k for a house deposit. We spoke to a mortgage advisor who advised to clear all our debt before we even started look at what kind of deal we could get.

Now our debt wasn't out of hand (car finance, 1k on CC's and DH had a loan with 1.5 years left to go). All completely manageable monthly, but no way we could afford to pay off in one go. So we put it in our savings and each month started to pay more off the outstanding amount.

Anyhoo, a couple of months later our in laws asked as to how the search was going as they thought we would be having loads of viewings and we explained that our advisor had said to pay off our debt first. They immediately said "Well, why aren't you using some of the deposit?" We said we didn't want to and they told us not to be so stupid and that they assumed that's what we would do anyways!

A week later after some settlement figures we were debt free and getting our agreement in principle.

Have a chat with your Dad. You might be tying yourself in knots for no reason!

You're putting a whole lot of energy into something that hasn't happened OP. In my experience you shouldn't ever make plans around this kind of thing until the money is in your bank. There's no point in worrying about it until then.

If you're given a gift for something, I would put it towards that. But I completely understand not everyone thinks that way. Could you pop a quarter onto your debts and the rest into savings?

Also house deposits are huge and there are 100 reasons why now might not be a good time to move - you don't have to disclose anything about your finances yet.

how much debt are we talking here? roughly? its a factor in the equation, not knowing makes it difficult to comment.

I think it would be stupid to refuse the gift, and I also think the fact you’d do that doesn’t mean you sound great with money either, I’m sorry, but it’s not good is it.

He’s your father, just explain your husband has brought some debts to thr party and you’re partly paying them off for him. The money is to be ring fenced. But that thr debts are so extreme it’s going to take you another one to two years just to pay them off,

I've been in a similar position and understand your concerns. I would separate it out

1. Its unlikely your dad would give you the money until you are ready to buy the house. Until then I suspect he will keep it in his account only transferring it during the house buying process. If he offers to give it to you before, ask him to keep it until needed. This means your DH can't have any access to it so it csn only be used for its intended purpose.

1. You don't have to explain your finances to your dad. Once you know how much he is generously gifting you, make an appt with a mortgage broker to find out how much you can afford to borrow and therefore how much you can afford to spend on a house. Once you know this you can start looking. You can use this time whilst looking to pay back other debts without telling your dad.

Good luck

@MrsWarleggan

My In Laws gifted us £60k for a house deposit. We spoke to a mortgage advisor who advised to clear all our debt before we even started look at what kind of deal we could get.

Now our debt wasn't out of hand (car finance, 1k on CC's and DH had a loan with 1.5 years left to go). All completely manageable monthly, but no way we could afford to pay off in one go. So we put it in our savings and each month started to pay more off the outstanding amount.

Anyhoo, a couple of months later our in laws asked as to how the search was going as they thought we would be having loads of viewings and we explained that our advisor had said to pay off our debt first. They immediately said "Well, why aren't you using some of the deposit?" We said we didn't want to and they told us not to be so stupid and that they assumed that's what we would do anyways!

A week later after some settlement figures we were debt free and getting our agreement in principle.

Have a chat with your Dad. You might be tying yourself in knots for no reason!

The difference in your situation is that it was partly your DH’s debt being paid off by HIS parents

This is not the same here where the OPs dad would be paying off debt that the OPs DH has accrued.

If I was the OPs dad I would be happy to help my DD get on the housing ladder, I wouldn’t be happy paying off my SonILs debt (especially if it was accrued in a previous relationship and so nothing to do with my DD)

You should clear any debt before you start saving.

This sounds more about you not wanting to have to say to yourself dad that you've got debt. And he'd have no reason to know under normal circumstances but by giving you a deposit for a house, he would of course be curious as to why you weren't then buying a house

If and when he offers you the money, you'll just have to be honest with him and say you have debts and what those debts total and why you can't take the money at this time for a deposit. And then see what he says