Gifted deposit and halifax mortgage

A question about : Gifted deposit and halifax mortgage

Sorry to keep asking so many questions!

About 8 months ago we wanted to apply for a mortgage and my sister gifted us Ј15k for our deposit. At the time we went with Santander but unfortunately we were declined a mortgage due to my partner not meeting the minimum employment requirements (she'd been in her job for one month and they wanted 3 months payslips).

Anyway, fast-forward 8 months and after saving as much as we can, we got a mortgage offer from Halifax 85% LTV on a Ј162k.

Actually it was for a property worth Ј160k so we've not changed the loan amount but will pay the extra ourselves meaning we're paying 16% deposit = 26k

The mortgage offer has been made and we've also passed a random internal audit but now the solicitor wants to know the source of the deposit? Why is this required at this stage? Shouldn't the bank request this before a mortgage offer?

I'm confused!

Best answers:

• Is it a request from the lender, or the solicitor's money laundering check?
  BTW the mortgage offer and contract paperwork have to reflect the same purchase price. You can't have one document saying one figure and another saying something else...
• So it sounds like the solicitor's money laundering check and nothing to do with Halifax. You can often find you are asked for ID, proof of address and proof of deposit by broker, lender and solicitor as we are all required to add to the "audit trail" for money laundering purposes.
  I now understand your comment about the purchase price.
• What exactly is the solicitor asking for?
  Presumably they only want a statement showing the deposit in an account?
  Are they asking to see the deposit building up over a protracted period?
• The solicitor does have to report a gifted deposit.
  I actually called a solicitor yesterday. My client's parents are gifting him the deposit and I wanted to run it past the solicitor. I have a gifted deposit letter, but wanted the solicitor's view.
  The choice was;-
  - go the gift route, then the solicitor wanted to see the parents and to report it to lender, which I'd already done anyway
  or
  - have the money transferred into the client's account and provide a statement from that account as the proof of deposit.
  As the parents live in Southampton and the solicitors are in Stourbridge, guess which we chose...?
• Solicitors will report the source of deposit to the lender as it is not from own resources. It is up to the lender to then decide how to proceed.
  You will need to get a letter from the donor stating it is a non refundable gift and no interest in the property etc.
• Getting a letter is not a problem at all. In fact the gifted amount has been in one of our acconuts for the last 8 months and last month we added the rest (mixture of savings and saleof some prized possessions.. booohoooo!)
  I guess we'll have to wait and see. I just hope we don't fall at the last hurdle, that would be devastating!
• More or less the same story --> were asked about the deposit. Provided with the gift letter and even a copy of passport of my mother. Now they demand 6 months of HER bank statements, although she is not a party in the engagement. She doesn't want to disclose her financial information even to me, not to say to some random third party she has no relationship with.
  I've examined all the guidance published by HMRC and industry recommendations and couldn't find anything like this. I obviously cannot provide data I have no access to.
  Thanks for advise
• Hi all,
  I'm wondering if you can help.
  I recently decided to go ahead with a house purchase however, I didn't have the funds until my March bonus was paid. I really didn't want to miss out on the property so my dad decided to gift me the funds and paid them directly into my account.
  I then went ahead with the purchase and so on; I've now discovered that my dad took this money out as a personal loan (as he didn't want to remove from investments) - I'm wondering how this will affect my mortgage application/solicitor money laundering checks.
  My dad is not expecting the funds back and will be paying them himself however, I'm worried that it will not look like this to the provider. I don't want to go further with the application process if I'm going to be stuck at this hurdle.
  How do you think this will affect my mortgage etc?
  Thanks so much in advance.
• It won't.
  How he raises the money is his affair.
  As long as the gift is correctly documented, there should be no issues for you.
• The solicitor now has to report the gift as you ticked the box.
  This gift is though, within Halifax criteria. I would think there is a very limited chance that this will affect your offer (unless your sister is moving in with you).
  Have a gift letter ready in the correct format for the lender.
  (PM me if you need the format)
• Thank you both for responding so quickly.
  I had a mild panic when I found out that things weren't go to be plain sailing.
  I've contacted my solicitor to ask as well as my financial adviser.
  Thanks for putting my mind at rest - fingers crossed I will be in touch regarding the gift letter
  Thanks,
• Hi Robyn,
  Kindly do update on the outcome as I am in a similar situation.
  Thanks and regards
• "This gift is though, within Halifax criteria. I would think there is a very limited chance that this will affect your offer (unless your sister is moving in with you)."
  Can someone please explain why the gift would affect the loan if the giver moves in to the property?
  Same-ish situation with us right now. Mortgage solely under husband's name but deposit coming from me (wife) and we were told by our solicitor that a gifted mortgage deposit from spouse is acceptable, but mortgage adviser tells us that is a bad bad move and will probably have our loan rejected just because we are not allowed to accept a gift from a person who will also be living in the property!
  Where do they expect the wife to live? and deposits are usually a joint thing from the wife or husband or both anyway! where do the lenders expect the deposit to come from? If someone can shed some light on this matter I would really be grateful.
• Many lenders don't like someone contributing to the deposit and living in the property when they aren't party to the mortgage.
  This is because the lender may have legal problems if it needed to repossess as the donor could claim an interest in the property, regardless of a letter to the contrary at the outset.