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Gifted funds

Buying a home with the help of your parents

First time buyers are finding the only way to jump onto the property ladder is with the help of “the Bank of Mum and Dad." Parents help out their children to buy their first home by way of giving them the funds. This may be considered an early heritance with money that would be coming their way in due course and parents are happy to pass it on to their children who need it.

When funds for a house purchase are gifted or loaned, the buyer’s conveyancer will need to carry out additional checks alongside the usual conveyancing process.

The extra checks when house purchase funds are gifted or loaned include:

  • EVIDENCE: asking for evidence of identity and proof of address in respect of each giftor.
  • PROOF: Asking for proof of funds and evidence of the source of the funds.
  • IDENTITY: Carrying out electronic identity checks in respect of each giftor.
  • SEARCHES: Carrying out bankruptcy searches in respect of each giftor.
  • CONFIRMATION: Asking for confirmation of the amount of the gift.
  • GIFT or LOAN: Asking for confirmation that it is a gift, that no part of the gift is repayable, that each giftor will have no stake in the property, and that no giftor will live at the property. We can assist you with a gifted deposit letter
  • LEGAL ADVICE: Recommending that each giftor obtains independent legal advice. This is particularly important because:
    • Making a gift may have inheritance tax implications.
    • A gift may not be the best option from the funder’s point of view. It may be preferable for the funder to secure a stake in the property by means of a Trust Deed or mortgage, protected by an entry on the register of title. This will ensure that the property cannot be sold without the funder’s consent, unless the mortgage lender repossess it. 
  • COMMUNICATION: Referring the matter to any mortgage lender who is involved with the property purchase.

It’s a legal requirement to prove where the funds come from when you buy a property. Conveyancers have a duty to guard against mortgage fraud and money laundering and must take steps to ensure that all funds used to purchase a property have been acquired in a legal way. If all the boxes are ticked and the conveyancers have no suspicions, lenders are normally happy to lend where gifted deposits are provided, but may be more reluctant where the funder wishes to claim a stake in the property.

You can find out more about Mortgage Gifted Deposits here 

A ‘giftor’ is the legal term given to the person giving the financial gift. Have a look at our legal glossary of conveyancing terms for further explanations of the terms used in the conveyancing process.

To discuss buying a property with the help of gifted or loaned funds please contact our experienced conveyancing team on 0113 320 5000 or email conveyancing@winstonsolicitors.co.uk

Client feedback

Leasa came recommended by a friend and we are extremely pleased with the service she and Winston Solicitors provided. We found Leasa to be very quick and she provided regular updates throughout, making the process particularly smooth. We will definitely appoint Leasa again when we next move.
Tom
Excellent communication throughout the whole process.
David
I appointed Winston’s as conveyancers for both the sale of my existing home, and purchase of my next one. Sidraa and Tom were fantastic, working with pace and always responsive by email and/or when I called. It was far more seamless than I anticipated and I was incredibly impressed with their efficiency and communication. Thank you!
Joseph
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Anonymous
Excellent service,highly professional and support me with purchasing the house.
Midhula
I found Winston Solicitors through, of all places, a post on Reddit from property flippers. They had great reviews on it and being a trusted person, did my due dilligence and checked Google too. I wasn't disappointed. I had been dealing with Amanda, Tom and Sidraa throughout my sale and purchase. I felt like I had the best team all the way through. Nothing got passed them and they were always prompt, helpful and friendly from start to finish. Sidraa certainly had her work cut out and she made me feel like they had my back and my interests at heart. Please don't be put off by using solicitors miles away. Most of this can be done online nowadays. It's all so easy to do. I don't want to move anytime soon but, if I have to, I will be using Winston Solicitors again and preferably the same team! Thank you all.
David
Leasa and Julie at Winston Solicitors were excellent to work with. Communicative and prompt with replies and emails and super clear on each step of the way. - June 2025
I Salmon, Surrey
Sidraa and Tom were both brilliant and made the whole process seamless as a first time buyer.Completely efficient, no messing around and more than competent.Thank you!
Benjamin
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