# Draft letter for mortgage- deposit gift



## Sesed (26 Mar 2012)

Can anyone give me an idea of the letter I need to send with my mortgage application to cover a gift from parents?  Will this do?  Am I missing anything?

i.e. 
Dear <Bank>

We <Mr and Ms. Sesed> gift £x to our daughter <Sesed> to purchase a property. This gift is unconditional and non-refundable.  

Sincerely 
Mr and Ms Sesed


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## itsallwrong (26 Mar 2012)

I would strongly recommend you have the money in your account outright.
I had serious trouble with someone trying to buy my house a few years ago.
They went to their solictor with the same setup and signed contracts.
The person who was giving them the money then passed away.
They had a lot of trouble getting the money and really messed us around.

The person you are looking to buy the house from could tell you to jump if you can't close the sale contract and maybe sue you to close the contract.
Be very careful signing house contracts with only a letter as assumed monies toward the total price.
If something happened to your folks in the interim of the contact being signed, the money could take upto a year to be released from probate.
I know a gift letter is accepted practice but after what happened to me, I would never do it again.
Conditions are all money in the purchasers name - no exceptions.

Please forbid anything happening to your folks.
But thats what happened me.


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## Sesed (26 Mar 2012)

Thanks for the reply.  It is not for that far along stage it is for the bank.  It is not 100% neccessary as we have the 8% deposit ourselves but it probably is best to have it show why mortgage we are applying for plus our savings are less than the offer price. I wouldn't sign anything without cash there, but this is just mortgage application stage


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## itsallwrong (26 Mar 2012)

Power ahead so.
Wow... you have a deposit!
Remember when they were a mythical term in mortgage speak?

Good luck with the house


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## Sesed (26 Mar 2012)

Thank you, I'll need it I have so much to do before I can even make an offer!!


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## DerKaiser (26 Mar 2012)

Address

                                                                                                Date 


*To Whom It May Concern:*


We wish to confirm that we are gifting the sum of € _______________ to ___________________________towards the purchase of the property at _______________________________________.

I would like to confirm that the monies are a gift and will not be repayable at any time.  We would also like to confirm that we waive any interest in the property on foot of making the gift.

If you have any queries in relation to the above, please do not hesitate to contact me.

Yours sincerely




___________________                      _______________________


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## bazermc (26 Mar 2012)

What about the tax liability arising on the gift?


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## Mrs Vimes (26 Mar 2012)

Since each parent can gift up to 3000 per annum to the op, and that's before they start using up their CAT threshold of 250,000, it is unlikely that there would be any immediate tax liability.


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## munchy (26 Mar 2012)

are banks giving mortgages with only 8% deposit these days? I presumed it was much higher like 20% before they will loan anyone money


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## LDFerguson (26 Mar 2012)

munchy said:


> are banks giving mortgages with only 8% deposit these days? I presumed it was much higher like 20% before they will loan anyone money


 
AIB are doing 92%.  A couple of others are doing 90%.


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## Sesed (2 Apr 2012)

Thank you all.  
What is the story with tax?  I presumed we were exempt


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## LDFerguson (2 Apr 2012)

Sesed said:


> Thank you all.
> What is the story with tax? I presumed we were exempt


 
See Mrs Vimes post above.


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## Sesed (2 Apr 2012)

Mrs Vimes said:


> Since each parent can gift up to 3000 per annum to the op, and that's before they start using up their CAT threshold of 250,000, it is unlikely that there would be any immediate tax liability.


 
So, the first 3k per parent is exempt, and then the remainder will be assessed as part of any inheritance we get i.e. calculated as if we were getting it then?


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## Jay1981 (11 Feb 2015)

Will bank look for bank statement of parents account if its a gift or is the letter enough.


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## Gordon Gekko (11 Feb 2015)

The letter should be enough. Sure the applicant has no access to his parents' bank statements?!


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## Jay1981 (11 Feb 2015)

Gordon Gekko said:


> The letter should be enough. Sure the applicant has no access to his parents' bank statements?!


Yeah but will the bank insist on it


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## Bronte (12 Feb 2015)

Jay1981 said:


> Yeah but will the bank insist on it


 

And so they should.  We don't want to go back to the madness of the boom time lending.  I actually thought gifts were no longer allowed as part of deposits.


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## dereko1969 (12 Feb 2015)

Are you looking at this as an alternative to explaining your winnings on the other thread?

http://www.askaboutmoney.com/threads/explain-where-money-came-from.191524/


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## 44brendan (12 Feb 2015)

The LTV limit does not include any restriction on source of the deposit funds other than a prohibition on the lending bank providing loans or using other means to get around the rules.


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## Jay1981 (12 Feb 2015)

dereko1969 said:


> Are you looking at this as an alternative to explaining your winnings on the other thread?
> 
> http://www.askaboutmoney.com/threads/explain-where-money-came-from.191524/


Yes.
Will it work


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## 44brendan (12 Feb 2015)

Jay, your tying yourself up in knots about something that is not a big deal!! Parental gifts are a regular occurrence and will continue to be a significant source of funds for FTB's. Generally a letter from the parents similar to that stated earlier in this post is all that is required. frequently no verification is requested. I have never come across a situation where parents bank statements have been requested. I'm sure most parents would decline such a request.


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## Jay1981 (12 Feb 2015)

I'm not a first time buyer. Trying to get second property.


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## dereko1969 (12 Feb 2015)

44brendan said:


> Jay, your tying yourself up in knots about something that is not a big deal!! Parental gifts are a regular occurrence and will continue to be a significant source of funds for FTB's. Generally a letter from the parents similar to that stated earlier in this post is all that is required. frequently no verification is requested. I have never come across a situation where parents bank statements have been requested. I'm sure most parents would decline such a request.


In the other thread he's trying to hide the source of the funds for his deposit which was gambling winnings, there is no parental gift.


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## courier123 (13 Feb 2015)

Sesed said:


> Can anyone give me an idea of the letter I need to send with my mortgage application to cover a gift from parents?  Will this do?  Am I missing anything?
> 
> i.e.
> Dear <Bank>
> ...


Hi there, AIB have their own template that you can use. You can ask them to send it to you if you're applying for a mortgage from them.


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## Bronte (14 Feb 2015)

dereko1969 said:


> In the other thread he's trying to hide the source of the funds for his deposit which was gambling winnings, there is no parental gift.


We all realise this but he must not risk being turned down for a mortgage by divulging the source of the funds is gambling.  Banks reject those whose current accounts show payments to bookies.


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## Steven Barrett (14 Feb 2015)

Bronte said:


> Banks reject those whose current accounts show payments to bookies.



he doesn't have any payments to bookies, he has the lodgement of a large winning. Seeing as he can't come up with a good explanation, he should

1) come clean. Say he went to Cheltenham last year and won an accumulator. If he has no other record of betting on his bank records, it may be accepted. 
2) Wait until that lodgement is over 12 months old and doesn't appear in the bank statement that he submits. 

His stories so far are pretty lame and will fall apart if a few questions are asked.

Steven
www.bluewaterfp.ie


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## Butter (14 Feb 2015)

KBC asked us for only six months of statements. They did ask quite a few questions though about transfers & deposits between our different accounts so a lodgement of that size would be noticed. 

Why not go to another bank that doesn't want 12 months of statements? 

If you don't care about lying then surely the gift from parents is the easiest story to spin? They could have had some type of investment that ended & the value of it was split between the children. That would explain a random cash figure.


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