Viewing a house? Ask these 6 important questions
Don’t be too shy to ask your real estate agent these critical questions when viewing a house as a buyer....
Scullion News & Resources
The journey of buying a property can be daunting, and the looming pressure of saving for that all-important deposit can be overwhelming. Particularly in Scotland, with ever-increasing mortgage interest rates, the required deposit for a home purchase is climbing, especially for first-time buyers. In light of this, it’s crucial for potential buyers to explore an alternative avenue: Gifted Deposits.
A Gifted Deposit is a financial lifeline offered by an immediate family member to cover part or the entirety of your deposit. It’s not a loan; it’s a gift, given with no expectation of repayment. Importantly, the family member providing this generous gift won’t stake any legal claims on the property you’re purchasing. There’s no future repayment obligation either.
While most mortgage lenders accept Gifted Deposits from immediate family members like parents, siblings, or grandparents, there’s no one-size-fits-all rule. It’s highly advisable to consult your financial advisor or mortgage lender to confirm the acceptability of a Gifted Deposit, not only in principle but also from specific family members. This step can save you significant hassle down the line. It’s also essential to inform your appointed Solicitor if you plan to use a Gifted Deposit.
In general, there’s no upper limit on the size of a Gifted Deposit, unless a particular lender imposes one. However, bear in mind that exceptionally large gifts might trigger inheritance tax concerns. It’s always wise to be aware of potential tax implications.
Obtaining a Gifted Deposit comes with strict anti-money laundering requirements. You’ll need to provide specific documents, including:
These requirements are in place to verify the source of the gift, ensuring compliance with anti-money laundering regulations.
Once you’ve assembled the necessary Gifted Deposit paperwork, we’ll report it to your mortgage lender upon receiving the signed gift letter. Approval from the lender is crucial before your source of funds checks can be finalised. Please be aware that the timelines for lender responses can vary, and in some cases, transactions may experience delays beyond our control. To mitigate any potential hold-ups, we strongly advise providing the requested source of funds documentation as early as possible.
Our Property Law team possesses extensive experience and a profound understanding of the complexities surrounding Gifted Deposits in Scotland. We’re here to guide you through potential legal issues and ensure a smooth property purchase journey. Don’t hesitate to reach out to us today for the support and expertise you need.