Gifted Deposits | What Others Aren’t Telling You… | Real Mortgage Broker Advice

Hello and welcome back to our channel and podcast! My name’s Gemma, and here at WIS we talk about all things relating to money, mortgages, and a positive money mindset.

On today’s episode of Let’s Talk Money and Mortgages, we’re joined again by Iftaka (“Ifthi”), a trained accountant and mortgage advisor with over 10 years of experience, and one of the founding directors here at WIS.

What is a gifted deposit?

Ifthi:

A gifted deposit is when a family member gives money to help someone buy a property.

Most often this comes from parents (sometimes called the “Bank of Mum and Dad”).

It can also come from siblings or close family.

The bank will usually require a letter confirming the money is a gift.

Can a friend provide a gifted deposit?

Ifthi:

Usually, no.

Lenders typically only accept gifted deposits from close family members (parents or siblings).

If it comes from a cousin or distant relative, some banks may accept, but not all — so you’d need to check.

Deposits from friends are generally treated as a loan, and banks are uncomfortable with that.

If you have an unusual situation, always check with an advisor first.

Do all lenders accept gifted deposits?

Ifthi:

No, not all — but most high street lenders do.

It’s important to:

• Check with your advisor before applying.
• Be upfront that you’re using a gifted deposit so they can match you with the right lender.

Some lenders may even suggest alternatives, such as:

• Joint borrower, sole proprietor applications.
• Other specialist schemes.

But these are not accepted by all lenders either, so advice is key.

Can gifted deposits be given in cash?

Ifthi:

Generally, no.

Cash is not usually accepted because of money laundering regulations.

It’s not just the bank — your advisor and your solicitor will also check where the money came from.

If the money is cash saved at home, it won’t usually be accepted. The deposit must be genuinely earned and traceable.

Can a gifted deposit come from overseas?

Ifthi:

Yes — but there are conditions.

Some countries are on sanctions lists. If the money is from one of those, it won’t be accepted.

There must be a clear audit trail showing where the money came from and how it reached your UK bank account.

What is an audit trail?

Ifthi:

An audit trail shows how the money was built up and transferred.

Example:

• Parents abroad save £10,000 over time.
• Their bank statements show this savings history.
• The £10,000 leaves their account and lands in your UK account.

Banks (and solicitors) will not accept:

• Cash savings abroad transferred without proof.
• Borrowed money given as a “gift.”

They need to see the full paper trail.

Why do solicitors also check gifted deposits?

Ifthi:

Because solicitors must comply with money laundering regulations, just like banks and advisors.

That’s why all three parties (advisor, lender, solicitor) will ask for the same evidence.

What should be included in the gifted deposit letter?

Ifthi:

The letter should:

• Confirm it’s a gift from a family member.
• State clearly that the person giving the money has no rights to the property.
• Confirm it is not a loan.

We have standard templates for this, but requirements can vary between banks, so sometimes the wording must be adjusted.

Are there alternatives to gifted deposits?

Ifthi:

Yes. Families can help in other ways, such as:

• Joint borrower, sole proprietor applications (parents help with affordability but don’t go on the title deeds).
• Guarantor mortgages (less common now, but still available).

That’s why advice is so important — you may have more options than you realise.

Final Thoughts

Gifted deposits are a great way for families to help buyers, especially first-time buyers, but there are rules to follow. Always:

• Check lender requirements early.
• Be prepared to provide letters and bank statements.
• Get professional advice to explore all options.

Reminder: A mortgage is secured against your home or property. It may be repossessed if you do not keep up with the mortgage repayments.