In Conveyancing, it’s possible for relatives/family to give you some sort of assistance(monetary wise) towards buying your house. Though this is classified as a gift some might believe that by giving the gift they own a part/share of the property which is not so. If the money was intended to be repaid, this would not be classed as a gift but as loan which could possibly affect your mortgage offer.

The term “gifted deposit” refers to a sum of money given to you by a family member that forms all or part of the deposit you require to buy a property. If a deposit is given to you from a loan, then this does not constitute a gift. If you have to pay the deposit back at any point, then this also doesn’t constitute a gift, as it becomes a loan.

If you are lucky enough to receive such help, it is important that you inform your lender at the beginning stage of the process when you apply for your mortgage.

Your solicitor will receive a mortgage offer on your behalf which may not state the gift and as your solicitors also acts for your lender, they will be required to report the gift to them unless it is specifically referred to in your mortgage offer.

Your Solicitor may ask that the person gifting you the money provide some things like

Gift Letter: This will be a signed declaration to state, among other things that they are giving you the money and will have no equity in the property.

Proof of Funds: In the bid to abide by the strict Anti-Money Laundering (AML) regulations, they will need to see proof of funds and where the funds have come from. Most times the request for a recent bank statement.

Identification: They will also request for a valid means of identification. This could be either their driving license or passport.

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