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Buachaill, Barrister
Category: Law
Satisfied Customers: 10974
Experience:  Barrister 17 years experience
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Can a occupier of a property not named on the mortgage

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can a occupier of a property not named on the mortgage gift some mortgage deposit money e.g brother?
Customer: replied 2 years ago.
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1. There is nothing to prevent an occupier of a property not named on the mortgage from gifting some mortgage deposit money to the person taking out the mortgage, such as his brother. This is perfectly acceptable in law and does not have any tax consequences, provided the person taking out the mortgage lives for seven years after the gift. In general, in England, gifts are not taxed. The occupier can continue to live in the premises under whatever agreement he reaches with his brother or mortgage holder. This is a perfectly acceptable arrangement. However, different issues would arise if the occupier wishes to obtain a property interest in the property if the money were not a gift.
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Customer: replied 2 years ago.
My solicitors have said to me there may be an issue with this as some banks accept and some dont, just worried if this effects the mortgage offer.
3. What the bank is concerned with is whether the person taking out the mortgage can afford to pay back the mortgage. Accordingly, there is no problem if the money is a gift because it means the borrower does not have to pay it back. However, if it wasn't a gift, there might be a problem. Banks are generally concerned if their borrower has another sum to pay back in addition to the mortgage amount.
Customer: replied 2 years ago.
they are hesitating to accept my brothers deposit gift as he is currently living in the property even though he has signed an occupancy waiver form and written a letter that he will have no interest in the property, just concerned that if this will any how effect the mortgage offer if they do not accept his gift, what are the chances??
however i have told them that he will be moving out by end of completion date because that will be the case as he will be moving to live with his girlfriend just thought that i should put his name on the form as he is currently in the property for now.
is this going to cause any sort of complications?any advice will be appreciated.Regards,
4. I would not have put your brother's name on the application form if he is not going to be repaying the mortgage. Otherwise, you are making him liable for the repayments as well. You are better off apply on your own merits with the benefit of the gift. Accordingly, if this bank turns you down, you should apply on your own merits to a different bank. That would be a much better approach.