Mortgage vs deposit

[r30]

I am getting married next year and we will be living in a house which at the moment is held under my name. My intended has a substancial amount of money on deposit, which we intend to use to reduce the mortgage on what will be our house. However we can't pay off the money now or we will be liable for gift tax. Would it be possible to put this money in a deposit account which would reduce the mortgage payments until the wedding after which we will use the money to pay off the mortgage?

 

[Brendan Burgess]

Could your intended not lend you the money interest free? Wouldn't the gift be just the interest not charged on the loan? Then you could repay them when you get married.

Brendan

 

[WhatsGoingOn]

I am getting married next year and we will be living in a house which at the moment is held under my name. My intended has a substancial amount of money on deposit, which we intend to use to reduce the mortgage on what will be our house. However we can't pay off the money now or we will be liable for gift tax. Would it be possible to put this money in a deposit account which would reduce the mortgage payments until the wedding after which we will use the money to pay off the mortgage?

You could switch to a current account motgage with First Active or NIB. With these mortgages, you do not pay interest on the amount that matches the money you have in your account. e.g. if you have a 300,000 mortgage and 100k in yur account, you only pay interest on 200k of your mortgage, so it is effectively the same as paying it off except you still have access to your money.

 

[z109]

You could switch to a current account motgage with First Active or NIB. With these mortgages, you do not pay interest on the amount that matches the money you have in your account. e.g. if you have a 300,000 mortgage and 100k in yur account, you only pay interest on 200k of your mortgage, so it is effectively the same as paying it off except you still have access to your money.

You could then open a joint account with both your monies in it.

Note, current account mortgages tend to have higher interest rates than standard trackers, so you will need to think about it carefully. Are you always going to have enough money in your current account to justify the higher rate of interest? Will you be able to resist the temptation to spend all the money in your current account?

 

[Bronte]

Don't want to rain on your parade, your intended should put the money in a high interest bearing account, she should not loan/give you the money now. After the marriage is the time to sort out the mortgage - not before.