Gifted Deposit Mortgage – How Family Help Can Boost Your Deposit
Saving for a deposit is one of the biggest challenges when buying a home. For many buyers, especially first-time buyers, support from family can be the key that unlocks the door to home ownership. A gifted deposit mortgage allows family members to contribute towards your deposit, helping you buy sooner, borrow less, or access better mortgage deals.
At Mortgage Bridge, we regularly help buyers use gifted deposits successfully — including those with complex income, single applications, or past credit issues. This guide explains exactly how gifted deposit mortgages work, what lenders expect, and how to make sure everything is done correctly.
What Is a Gifted Deposit Mortgage?
A gifted deposit mortgage is where some or all of your mortgage deposit is provided as a non-repayable gift, most commonly from a close family member.
In simple terms:
Lenders allow gifted deposits as long as the money is genuinely a gift and not a loan.
Gifted deposits usually come from:
- Parents
- Grandparents
- Close family members
Some lenders will consider gifts from wider relatives, but this varies.
The most important rule is that the person gifting the money must not expect it to be repaid and must not have any ownership interest in the property.
Can Family Gift a Deposit for a Mortgage?
Yes. Family gifted deposits are widely accepted by mortgage lenders.
Most lenders are comfortable with:
- Parents gifting a deposit
- Grandparents gifting a deposit
- Family helping first-time buyers
However, lenders differ in:
- Who they accept gifts from
- What documentation is required
- How the gift is verified
This is why using a broker matters. We know which lenders are flexible and which have stricter criteria.
How Does a Gifted Deposit Help Your Mortgage Chances?
A gifted deposit mortgage can significantly improve your options.
Buy a Home Sooner
A family gift can remove years of saving and allow you to move forward now.
Access Better Mortgage Rates
A larger deposit reduces the lender’s risk, often unlocking more competitive interest rates.
Lower Monthly Repayments
Borrowing less means smaller monthly payments and improved affordability.
READY TO GET STARTED?
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Support Complex Applications
If you’re buying on one income, are self-employed, or have past credit issues, a stronger deposit can offset risk.
We explore this further in our guides on bad credit mortgages and single income applications, where gifted deposits often play a key role.
Does a Gifted Deposit Have to Be Declared?
Yes — always.
All gifted deposits must be declared to the lender.
Failing to do so can result in delays or a declined application later in the process.
Lenders will usually request:
- Proof of where the money came from
- Confirmation that it is a gift, not a loan
- Evidence the gifter can afford to give it
Transparency from the start protects your application.
What Is a Gifted Deposit Letter?
A gifted deposit letter is a signed document confirming the details of the gift.
Yes, lenders require one.
The letter typically confirms:
- Who is gifting the money
- Their relationship to you
- The gifted amount
- That the money is non-repayable
- That the gifter will not live in or own the property
We provide lender-approved templates to ensure this is completed correctly the first time.
Do Gifted Deposits Affect Mortgage Affordability?
Usually, no.
Because a gifted deposit is not repayable, it does not count as debt and does not normally reduce how much you can borrow.
That said, lenders will still assess:
- Your income
- Your monthly outgoings
- Your credit history
If the deposit were a loan rather than a gift, it would impact affordability — which is why lenders insist on clear confirmation.
Can I Use a Gifted Deposit as a First-Time Buyer?
Yes. Gifted deposit mortgages are extremely common for first-time buyers.
Family support can:
- Reduce the amount you need to save
- Help you meet minimum deposit requirements
- Improve approval chances
We cover this in more detail in our first-time buyer mortgage guides, including how gifted deposits fit into lender assessments.
Can I Get a Gifted Deposit Mortgage with Bad Credit?
Yes — and gifted deposits can be particularly helpful in these cases.
If you’ve had:
- Missed payments
- Defaults
- CCJs
- A past debt solution
A larger deposit can give lenders confidence and open up specialist mortgage options.
We regularly help clients with historic credit issues secure mortgages by combining specialist lenders with gifted deposits.
Will Lenders Check the Person Gifting the Deposit?
Yes, but the process is straightforward.
Lenders usually require:
- Proof of identity for the gifter
- Evidence of the source of funds
- Confirmation the money is not borrowed
These checks are standard and protect everyone involved.
Can a Gifted Deposit Be Used for Fees as Well?
Sometimes.
Some lenders allow gifted funds to be used for:
- The deposit
- Solicitor fees
- Other purchase costs
Others restrict the gift to the deposit only. We confirm this early so there are no surprises later.
Are There Any Risks with Gifted Deposit Mortgages?
When handled properly, gifted deposits are very safe. Problems usually arise when the rules are misunderstood.
Common Mistakes to Avoid
- Treating the gift as a loan
- Not declaring the gift early
- Using funds without clear proof
- Assuming all lenders accept all gifters
This is why specialist advice makes such a difference.
Alternatives to a Gifted Deposit
If a full gifted deposit isn’t possible, other family-assisted options may help, including:
- Family-backed savings support
- Joint borrower sole proprietor mortgages
- Deposit boost arrangements
We explore these in more detail in our family-assisted mortgage guides.
How Mortgage Bridge Helps with Gifted Deposit Mortgages
We do more than check whether a lender accepts gifted deposits. We:
- Match you with the right lender for your circumstances
- Ensure paperwork meets lender requirements
- Structure applications for complex income or credit
- Reduce the risk of unnecessary declines
Let’s explore your options together.
Key Takeaways
- Gifted deposit mortgages are widely accepted
- The gift must be non-repayable and fully declared
- Larger deposits can improve rates and approval chances
- Lender rules vary, so expert guidance matters
Summary
A gifted deposit mortgage can be a powerful way to move forward with a property purchase when saving alone feels out of reach. Support from family can help you buy sooner, reduce the amount you need to borrow, and improve your chances of securing a better mortgage rate.
Most lenders accept gifted deposits, provided the funds are genuinely a gift, properly declared, and supported by the right documentation. Whether you are a first-time buyer, buying on one income, self-employed, or have had credit issues in the past, a gifted deposit can significantly strengthen your application when paired with the right lender and structure.
Getting the details right is essential. Lender criteria vary, paperwork must be accurate, and the deposit must never be presented as a loan. With specialist guidance, gifted deposits are one of the most effective ways families can help buyers take the next step onto the property ladder.
This guide provides general information only, personalised recommendations must come from a regulated mortgage advisor
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Important information: Mortgage Bridge provides information only and acts as a mortgage introducer. We do not provide mortgage advice or make lender recommendations. We can introduce you to an FCA-regulated mortgage adviser who can provide personalised mortgage advice.