If you are gifted money to cover the portion or full amount of your deposit, this is called a gifted deposit. This can be given to you by a friend or family member, however, there needs to be an agreement that you don’t need to repay the money.
Gifted deposits are helpful if you can afford the monthly payments but not the initial deposit. The chances of getting better rates can be higher if you have been gifted a large amount of the profit.
In circumstances where you can afford the monthly repayments but can’t save for your initial deposit due to being on a lower salary, this can be very beneficial.
Usually, your parents, be this birth or adopted, gift a deposit. This method can be referred to as “The Bank of Mum and Dad”.
Alternative family members could be available to gift you a deposit. It’s possible to do this but it does depend on the individual lender. Furthermore, trying to find the right one requires care.
An equity release in Doncaster can be a way of gifting you a deposit, providing that the family member or friend who is gifting to you is over the age of 55.
The option of their parents being able to help with their mortgage is a concept many clients don’t know about or sometimes they feel like they can’t ask their parents for help.
Usually, many parents are happy to lend a helping hand with their children’s property dreams.
It’s widely believed to be more beneficial for people to take out a mortgage compared to renting. This may be because you would be able to pay less per month.
A lot of the time we find that gifted deposit comes from inheritance, however, parents may gift it earlier in life. In some instances, they may have saved up enough or have released a certain amount of equity from their own property.
One thing that lenders don’t always feel is best to do is using a loan in order to pay your deposit. The reason for this is there is the risk that you won’t have enough disposable income to not only the mortgage but the loan at the same time.
The maximum amount of the deposit you want to gift is up to you. Some lenders, require 5% of the deposit to be from your own pocket.
First time buyers in Doncaster and home movers in Doncaster can benefit from a gifted deposit. Depending on the lender, the Help to Buy Scheme can be useful to have alongside a gifted deposit. This is because the scheme requires a 5% deposit, so paying that via a gifted deposit could be an option.
You are required to have a Gifted Deposit form to give to the lender. You might be required to show additional proof & ID (donor ID/bank statements and so on), however, this depends on the lender.