Gifted Deposit FAQ’s | Mortgage Advice in Lincoln

What is a Gifted Deposit?

A gifted deposit can be either the full amount or a portion of the deposit that is gifted to you, with an agreement that you don’t need to repay the money.

How Can Gifted Deposits Help?

Gifted Deposits come in handy when you have enough money for your monthly repayments but can’t afford the initial deposit. Having more gifted deposit available may also open you up to better rates from a lender.

It can also help if you’re on a lower salary and can afford the monthly mortgage repayments but are unable to save your initial deposit.

Who Can Gift The Deposit?

Predominantly it is your parents who can gift you the deposit. This can be both birth and adopted parents. You may see this online as the “Bank of Mum & Dad”. There are potential alternative family members who could also be considered when looking at utilising a gifted deposit.  This is very much dependent on individual lenders so would require care when trying to find the right mortgage lender.

Do Your Parents Know You Need Help?

We often find that clients aren’t aware that their parents can help with their mortgage, or don’t feel like they can ask them to. The reality is that most parents are more than happy to help their children, wanting them to get on the property ladder.

Statistically, taking out a mortgage is better than renting, due to you being able to potentially pay less per month. The deposit can often come from inheritance, although parents have been known to gift it earlier on in life if they already have enough saved or have released a certain amount of equity from their own property.

Gifted Deposit VS Loans

Most lenders won’t accept a loan as a means of paying your deposit. This is down to the uncertainty that you’d have enough disposable income to pay back both the loan and the mortgage simultaneously.

Is There a Maximum or Minimum Gifted Amount?

There is no maximum limit on the amount of gift you can receive although I know of at least one Lender that insists you put in at least 5% deposit from your own funds.

Who Can Benefit From a Gifted Deposit?

The people who benefit the most from this tend to be First-Time Buyers in Lincoln and Home-Movers in Lincoln. It can also be useful when in conjunction with the Help to Buy Scheme in Lincoln, as the required 5% deposit, depending on the lender, can be paid via Gifted Deposit.

What Proof is Required?

Generally speaking, all lenders will require a Gifted Deposit form. Depending on the lender, you may be asked to provide further proof and ID (things like donor ID or bank statements).

Lincolnmoneyman.com & Lincolnmoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is Registered in England, No. 6789312 | Registered Address: 10 Consort Court, Hull, HU9 1PU.

Authorised and Regulated by the Financial Conduct Authority.
We are entered on the Financial Services Register No. 627742 at www.register.fca.org.uk

The information contained within the website is subject to the UK regulatory regime and is therefore primarily targeted at customers in the UK.
Should you have cause to complain and you are not satisfied with our response to your complaint, you may be able to refer it
to the Financial Ombudsman Service, which can be contacted as follows

The Financial Ombudsman Service, Exchange Tower, London, E14 9SR
www.financial-ombudsman.org.uk

© 2022 Lincolnmoneyman

Lincolnmoneyman, Commerce House, Outer Circle Road, Lincoln, LN2 4HY.

Moneyman Logo







Moneyman Logo




Moneyman Logo

Ask Your Question





    Moneyman Logo

    Moneyman Logo







    Moneyman Logo

    Book your Free Consultation

    7 Days 8am - 10pm

    Moneyman Logo

    Moneyman Logo