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.

If you are close to your father then I think that you need to mention in conversation that you intend to buy once your husband debts are paid off.

You may well be embarrassed but its better to be honest.

Can't quote poster for some reason but re "usual MN hypocrisy" -

I've never seen a post saying my husband's dad wants to give us the deposit to buy a house but I want to use it to pay off debts I built up while I was married to someone else and after we split but before I met my now husband where the replies are all yes that's fair all money is family money of course you're entitled to pay off your pre relationship debts with money your fil has given for a house deposit.

Maybe I missed them. MN is busy and it's impossible to read everything.

Can you accept it, put it in savings and suggest that you haven't bought yet as your DH would like to be able to save up and match the deposit gifted? This is what we did as my MIL gifted a chunk to my OH and I felt awkward about the situation so paid my half and he kept some of the money as a nest egg.

I'd say exactly the same if OP was male, his wife had built up a load of debt when living with someone else, and she suggested using her FIL's deposit gift to pay off HER debt

So would I

In fairness the PP was correct and without doubt some answers would have been different if the sexes were reversed - but that doesn't mean they'd have been right

You don’t want your dad to know about your DHs debt because he’ll think he’s a bad prospect. Is he?

I would think major red flag about your DH that he suggested paying off his own debt with it, he probably thinks he’s hit the jackpot. Are you younger and from a well off family?

Does it have to be your forever home and could you put the debts on the mortgage? I’d worry if you wait a year or more prices will have risen.

OP hasn't said whether his debt was from before they were together.

Yes she has @MrsWarleggan, and it was. He accrued it when he was with someone else.

Given the annual rate of house price rises in much of the country you are better off trying to buy as soon as you can, even with the debt.

If he is financially minded he may not mind it going firstly towards debt as typically the advice is to clear debt before saving

My sister told me this weekend that he is thinking of gifting DH and I a house deposit.

Nothing is decided yet. IF and when this gift is offered, I would do as others have suggested & ask your lovely dad to put it into an account for you until you find the house you want/promotion comes through & you can get a better mortgage etc.

You tell your dh that it is meant for a deposit (legally ringfenced to you) and your lovely dad is only handing it over when mortgage is agreed & house is ready to be purchased.

So no debt has to be revealed and no judgement forthcoming. And if your dh is eyeing up a spending spree & gets narky over this plan then maybe it's best your dad hangs onto the money for you so (worst case scenario) it's not split in a divorce settlement.

@BrieAndChilli

DH family gifted us a house deposit - we didnt actually get the money (partly due to probabte/family trust set-up) until we needed too transfer it to the solictiors - so aout 6 months after we were offered the money. Could you not 'accept' the gift but ask your dad to hold onto it until you actually need to pay the deposit, take your time 'looking' for a house while paying off debts. we didnt disclose any of our finances to DH family, but equally we were desperate to buy and move as had nightmare neighbours!

We did exactly the same.

The money hasn’t come yet. I can see why you’re worried. I would wait until - if - if happens and at that point start looking for houses, which can take a long time - a long time in which you can pay down the debts as planned with no one asking any questions.

Good luck with the house search and with getting rid of your collective debts, OP :)

I can't see any issue with popping it in an ISA until you're ready to buy but should be used as intended unless you have a frank conversation and it is agreed that you can pay off debts with it.

But surely clearing debts will help you with the mortgage application?

@RandomCatGenerator

The money hasn’t come yet. I can see why you’re worried. I would wait until - if - if happens and at that point start looking for houses, which can take a long time - a long time in which you can pay down the debts as planned with no one asking any questions.

Good luck with the house search and with getting rid of your collective debts, OP :)

This ^ I wish I was calm enough to think this way, but, like OP, I'd be fretting.

Use it for a deposit or put it in your name in the bank so you don’t chip into it . I’m sure your dad would understand that you are not ready to move yet . Also I thought if you split up in the future that lump sum would be repaid to you if you divorced in the future( perish the thought)

I would be doing exactly that if my dad gave me a deposit on house that’s exactly what the money would go on ,

A dream gift in many people’s eyes but I appreciate the dilemma.
Could your dad put the money to one side and keep it for you until you’ve paid off your debts?
Would you find it hard to admit to having debt? Especially as your dad is in finance and may disapprove?
Come clean if you can. Good luck.

I think using the money to pay off debts is a mistake no matter how much financial sense it makes. If you are a couple that are comfortable with getting in debt in all likelihood you would use your dads gift to become debt free then not actually ever manage to save a similar amount. It’s very hard to get a big lump sum of money together if you are one of life’s spenders. I agree with a lot of the other ppl on here. Put the money in an isa in your name and get those joint debts paid off together. Knowing the mobey for a deposit was waiting fior me would be a huge incentive. I would tell dad a sanitised version of the truth. You just need to sort a few things out, get some money together for decorating/furnishing etc. Good luck, you are lucky to have such a generous dad, don’t make him feel bad for trying to do a good thing. It’s hard enough being a parent!!!

Paying off debts makes financial sense specially if it is expensive debt such as credit cards but It depends how you and your husband deals with money. Would you realistically save or just get more debt? I would pay the debt but me and my dh are in the same page about money and would stick to a saving plan. Also I wouldn't wait for a forever home if you are paying rent. It doesn't make sense to pay rent if you are in a position to buy a house.

May i suggest that you asked dad to invest the money on your behalf, and that when you have the rest of the financial situation in place, you will come a knocking.

Deposits are expensive. Accept it gracefully and use it as a deposit. Don't pay debts off with it.

@openallflowers

But surely clearing debts will help you with the mortgage application?

That would make sense if it was OP's debt. But most of it is her DH's, which he amassed before she knew him and when he was with someone else. It's up to him to get rid of that debt, not OP's father, with his generous gift.

Since OP has already said that her DH is poor with money, the chances of him ever saving that money back to put the father's gift back, are very very slim.

I would not worry too much in advance . The money may give you good incentive and there may be the opportunity to roll up the debt into a low interest rate mortgage if you have been paying it off.

@saraclara

Your dad is gifting you a house deposit, not a means of paying off your debts.

Your DH should keep out. Repaying the debts suits him very well, as he's no longer responsible for them. What if (worst-case scenario) he left you as soon as your dad's money had been used to pay the debts off?

If you can't buy yet, the money goes into an ISA in your name. It's the only fair thing to do.

^ protect your cash