Gifted Equity Mortgages
Helping you make your dream home a reality with the support of gifted equity from your loved ones.
Understanding Gifted Equity Mortgages
Gifted equity is a way for sellers, often family members, to help buyers purchase a property without providing cash upfront. Instead of gifting money for a deposit, the seller agrees to sell the property at a price lower than its market value. This discount creates instant equity for the buyer, as they effectively gain a portion of the property’s value without needing to pay for it.
Lenders have varying policies on gifted equity and concessionary purchases, and it’s important to understand how different mortgage providers assess these situations. Some lenders may accept the discounted value as the buyer’s deposit, while others may have specific requirements or restrictions.
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Our Gifted Equity Mortgage Services
Fennel Financial offers comprehensive services to help you navigate gifted equity mortgages with ease.
Personalised Advice
Receive tailored guidance to ensure your gifted equity arrangement aligns with your financial goals.
Comprehensive Support
From initial consultation to mortgage completion, we support you every step of the way.
Why Choose Fennel Financial for Gifted Equity Mortgages
Partnering with Fennel Financial ensures you receive expert advice and dedicated support tailored to your unique financial circumstances.
Expert guidance on navigating gifted equity arrangements to meet your homeownership goals.
Access to a wide network of lenders offering competitive Gifted Equity Mortgage products.
Personalised support throughout the entire mortgage process, ensuring a seamless experience.
What Are Gifted Equity Mortgages?
A gifted equity mortgage is a financing option that allows buyers to secure a mortgage using the discounted value of a property as their deposit. This can be particularly useful for those purchasing from family members, landlords, or even employers.
When applying for a mortgage under these circumstances, lenders will assess factors such as the relationship between the buyer and seller, the property’s market value, and the percentage of the discount provided. Some lenders take a more flexible approach, recognising the equity as a valid deposit, while others may require additional financial contributions from the buyer.
Understanding how different lenders evaluate gifted equity is essential for securing the right mortgage deal. Seeking expert guidance can help buyers navigate lender policies and ensure they meet all necessary criteria for approval.
Book an appointmentFrequently Asked Questions
Here are some common questions about Gifted Equity Mortgages.
A Gifted Equity Mortgage allows you to use equity gifted by family or friends to help finance your home purchase, reducing the amount you need for a deposit.
Depending on the amount gifted, there may be tax implications such as Inheritance Tax considerations for the giftor. It’s advisable to consult with a tax professional.
Lenders will treat gifted equity differently, often requiring a formal declaration of the gift and may have specific requirements to ensure it doesn’t constitute a loan.
Yes, clear communication and formal agreements can help ensure that gifting equity doesn’t strain personal relationships.
You’ll need a formal gift letter stating that the funds are a gift and not a loan, along with any supporting financial documents from the giftor.
Limits can vary based on lender policies and the specific mortgage product, so it’s best to consult with a mortgage advisor to understand your options.
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