Gifted Deposit

[DCASTLE]

Hello everyone, I am after some advice please...

I am currently buying a property using some money that my parents gave me. I was told by the mortgage broker, the mortgage lender and the solicitor that I needed to declare such money as gifted deposit.

So far, I have provided bank statements from both accounts that giving and receiving the money. I also provided my own ID and my parents' IDs. More importantly, all parties (broker, lender and solicitor) have asked my parents to sign a declaration form (3 different formats) for each party. It has been going on for a month now, and I have just written to the solicitor asking for an update. The solicitor replied to say she needs to do some international funds checks. My parents used to live in the UK but they are not currently. The money that they gave me is from a UK company's dividend payments to their UK bank account. The money has always been in the UK, never left the country.

My questions are:

1. What are these international funds checks?
2. Is it a normal routine that when a child receives gifted money/deposit from their parents, the solicitor has to perform an intensive check on these money?

Many thanks in advance...

[enaid]

Hi, it is all to do with the money laundering rules. All seems a bit OTT but it has to be done and as we know there is no rushing sols etc.

[Crazy council]

Hi, it can also be to do with the morgagee

if your given money for the deposit, or your family owned the property and sold it cheeper ( both classed the same ) the solisitor has to check were the money came from formaly, and that its not an undeclared loan. They they have to make sure, your not purchasing for someone else.

[DCASTLE]

Thank you all for your message.

The solicitor is now waiting for my parents to return a signed declaration form from the overseas. I warned the solicitor that it will take up to 7 days for the post to arrive in the UK. The solicitor says she won’t be able to assess the gifted deposit and to complete the international funds checks until she has received the form from my parents.

I do get frustrated that a month has passed by but there is hardly any paperwork that has been done for the purchase. I feel like I am kind of waiting the vendor to pull out at anytime here due to the slow progress, sigh...

[enaid]

No chance or email with the documents? just trying to push iy along a tad if possible.
It's a simple enough declaration letter example below

(Address of Givers)

(Date)

To: (Your mortgage company)

Re: Purchase of (address of the place you’re buying).

Dear Sirs,

(I/We) confirm that (I/we) (am/are) gifting (full names of purchaser/s) of (address of purchaser/s), (my/our) (relationship to giver/s), £(amount) towards the deposit for the purchase of the above property.

(I/We) confirm that the deposit is an unconditional and non-repayable gift, that (I/we) will have no interests or rights in the property whatsoever. (I/We) also confirm that (I/we) will not reside in the property.

(I/We) confirm the availability of the deposit monies and understand that (I/we) may be asked for proof.

(I/We) agree that any personal documentation provided to support this application will be held in a mortgage file with all other information relating to this mortgage application. If the mortgage applicant(s) request(s) a copy of their mortgage file now or at any point in the future, the personal information that (I/we) have provided will be included in the information that is provided to the mortgage applicant(s).

Yours faithfully,

(their signature/s)

Just a note too, if the person gifting dies within 7 years of the gift, inheritance tax may have to be paid, not gone onto this fully as yet but just something else to think about.
Well a quick read and it seems the gift will be counted in the estate if the giver dies within the 7 years so looks like if given jointly it will work out better imo. Also dependent on the threshold £325k at present.

[DCASTLE]

Thanks ENAID

The solicitor insisted to post a covering letter and a declaration form to my parents directly. But after a hiccup on the deposit amount, she decided to ask me if she could email the paperwork to my parents instead. I have no idea why she did not do that in the first place and why she tried to bypass me dealing with my parents directly.

Anyway, she did mention in her introduction pack that she is a paralegal, but I didn’t pay too much of my attention on her job title. In fact I didn’t know what her job title meant until someone pointed out she is a trainee. I don’t have a problem with that as we all started from the bottom in our careers, but what I have noticed so far is the infromation that she has given me is not consistent.

For example, she wanted to see my parents IDs, but never said what type of IDs they can provide. Bear in mind that my parents are not living in the UK currently, so would they be OK to use a foreign driving licence or a foreign credit card or something else? As she only wanted my parents to deal with her directly, so whatever my parents supplied to her, it would be sent to her by airmail and take a week to reach to the UK. I don’t want my parents to send her a wrong type of IDs, so I contacted her twice to ask specifically what type of IDs she would accept from my parents. She never got back to me. My mortgage broker had to write to the solicitor to ask the same question then she wrote back to say it was either a passport or a driving licence. She even said she has already told me on 14 Feb. Well, I went back to my old emails to check, I did get an email from the solicitor’s colleague on 14 Feb, and it did mention about my parents’s IDs, but never said what IDs my parents could supply. I thought ‘wtf?’.

As the solicitor is still working on this gifted deposit, I thought I was better not to challenge her now. I shall wait until the end of the purchase then I will write to her firm to mention about my experience and some feedback. I regret very much to use this solicitor firm to deal with my purchase to be honest.

[enaid]

Well it is usually photo ID they need these days with anything.
Hope all goes well with the purchase please update us if you can, I will be hopefully be gifting my son in the near future so any hiccups, prewarned is prearmed so they say lol
As a side Legal Beagles started a sister site Juutbeagle https://justbeagle.com/ as it was very much apparent folks were having difficulties with all manners of legal services so thought something needing doing to help the consumer. Next time you need a service have a browse on there x

[DCASTLE]

It has been almost a month now since I last responded to this thread, I thought I must do an update of where I am now.

Unfortunately, the purchase is still ongoing. The solicitor has only confirmed on 2 March that they were satisfied with the gifted deposit. It has taken the solicitor 3 full weeks to check, investigate and search for this gifted deposit. If I knew it would cause so much trouble to receive money from my parents, I would not take the money in the first place.

To ENAID, my advice is to give your son the money as soon as you can and in cash rather than bank transfer. If your son can deposit the money to his bank account bit by bit, hopefully he can avoid what I am experiencing here, and he can call it his own money instead of a gifted deposit.

I am sure there is a better way to deal with a gifted money which is from parents to children.