First time buyers
Gifted deposit mortgages
Many first-time buyers get help with their deposit from family. Lenders have rules about gifted deposits, so it helps to know what they may ask for before you apply. Tony explains the process and compares options from over 100 lenders.
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- Lenders usually ask for a signed gifted deposit letter
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Your home may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.
How a gifted deposit works
A gifted deposit is money given to you towards your purchase that you do not have to repay. Lenders need to be sure of that, and of where the money came from.
Good to know
Things to consider
- A gift is different from a loan. If the money has to be repaid, tell your adviser, as it can affect how lenders see your application.
- The giver may want their own legal advice, particularly if the amount is large.
- Gifted deposits can sometimes be combined with your own savings. The total deposit is what sets your LTV.
- Rules vary by lender and can change, so speak to an adviser before you start.
Meet your adviser
Hi, I'm Tony Flynn
I'm a mortgage and protection adviser based in Carluke, helping people across Lanarkshire and Scotland.
I've spent 15+ years in finance and have been named Mortgage Professional of the Year at the Prestige Awards Scotland five years in a row. I'll explain your options in plain English so you know exactly where you stand.
Gifted deposit questions
Can I use a gifted deposit for a mortgage?
Many lenders accept gifted deposits from close family, usually with a signed letter. Criteria vary and nothing is guaranteed. Tony can check which lenders may suit you.
What is a gifted deposit letter?
It is a document, signed by the giver, confirming the money is a gift that does not need to be repaid and that they will have no interest in the property. Lenders usually provide or ask for their own wording.
Can friends give me a gifted deposit?
Some lenders only accept gifts from close family, so it depends on the lender. Tony can tell you which options may be open to you.
Will the giver be checked?
You may both be asked to show where the money came from, for example through bank statements. This is a standard part of lender checks.
Do you charge a fee for mortgage advice?
There may be a fee for mortgage advice. The amount depends on your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed. We will explain this before you commit.
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