If you’ve landed here, chances are someone has kindly offered to help you with your house deposit. Whether it’s your parents, a family friend, or another generous soul – this kind of financial help is called a gifted deposit.
But before you can move forward with your mortgage application, most mortgage lenders will need you to make that gift official. And that means writing a gifted deposit letter.
Let’s break down exactly what it is, why it matters, and how to get it right.
Why a gifted deposit letter matters
Mortgage lenders need to know where your deposit is coming from, and that it’s not a loan you’ll need to repay.
Why? Because loans add risk. If someone else can claim part of the property or expects repayment, it could affect your ability to make mortgage payments.
So, lenders ask for a formal letter confirming that any money gifted towards your deposit:
- Doesn’t need to be paid back
- Won’t give the gift giver any legal interest in the home
- Has come from a legitimate source
That’s where the gifted deposit letter comes in. It’s a simple way to tick all those boxes – and avoid delays in your mortgage application.
What to include in your gifted deposit letter
Here’s what you need to cover in your gifted deposit letter:
- Your full name and current address
- The full name and address of the gift giver
- The relationship between you and the gift giver (e.g. parent, grandparent, friend)
- The total amount being gifted
- The purpose of the gift (i.e. to go towards the purchase of a property)
- Confirmation that the gift is not a loan
- Confirmation that the gift giver will have no legal or financial stake in the property
- Confirmation that the gift doesn’t need to be repaid
- Where the money has come from (e.g. savings, sale of a property, inheritance)
- Signatures from both parties
- Date the letter was signed
💡 Top tip: Keep the tone formal and straightforward—it’s an official document, not a thank-you note.
What else your gift giver will need to provide
To meet anti-money laundering (AML) requirements, the gift giver may also need to show:
- Photo ID (like a passport or driving licence)
- Two proofs of address. These could be:
A recent utility bill
A council tax statement
A bank statement
A letter from HMRC
They may also need to show where the money has come from, for example, from the sale of a house or shares. Lenders will usually want the gift giver to provide the last three months of bank statements from the account where the money is being held. It’s a good idea to gather these documents early to help avoid delays.
Watch outs to avoid delays
🏦 Not all lenders accept gifted deposits
Some lenders don’t accept gifted deposits at all. Others do, but only if the money comes from a close family member, not a friend. Because the rules vary from lender to lender, it’s important to speak to a mortgage expert early on to make sure your gifted deposit will be accepted.🕒 Timing matters
Your mortgage broker or lender will ask for this letter early in the application process. Don’t leave it until the last minute.
📑 Bank statements may be required
Lenders will usually ask the gift giver for the last three months of bank statements from the account where the money is being held. It’s a good idea to gather these documents early to help avoid delays.
📄 Format counts
Most lenders accept a scanned letter with a physical signature or a PDF with an e-signature.
📄 Some lenders have their own gift letter template
Some lenders will ask the gift giver to complete their own gifted deposit form, which your adviser will send over, or the lender will provide it directly if you’re applying without a broker.
🌍 Overseas givers may be a no-go
Some lenders won’t accept gifted deposits from outside the UK. If your gift giver lives abroad, speak to your broker early.
⚖️ It can impact the gift giver
If the amount is large or could affect their own finances, it’s worth the gift-giver getting independent legal advice.
Template: Gifted deposit letter example
You can copy and paste this into a document and fill it out. Make sure it’s signed and dated by the person giving the gift.
Date: [dd/mm/yy]
Name of person giving the gift:
[Full name(s)]
Address of person giving the gift:
[Full address]
To whom it may concern,
I/we [delete as needed] confirm that I/we, [Full name(s)], am/are giving £[amount] as a gift to [Full name of person receiving the gift]. This money will be used as part of the deposit to help them buy a home at [property address, if known].
I/we confirm that:
- This is a gift, not a loan. It does not need to be paid back.
- I/we will not live in the property.
- I/we will not have any legal or financial interest in the property.
- The money comes from [briefly explain the source, e.g. savings, house sale].
- I/we understand that giving this gift may affect my/our own finances, and I/we am/are happy to go ahead with it.
Gift Giver Signature: ____________________________
Printed Name: [Full name]
Date: [dd/mm/yy]
[Add second gift giver details and signature if needed.]
In summary
Getting a gifted deposit is a huge help, but it does come with a bit of admin. A clear, well-written letter can speed things up and give your lender everything they need.
If you’re unsure whether your lender accepts gifted deposits, or if your situation is a bit more complex (e.g. overseas gifts, multiple givers), speak to one of our expert mortgage advisors.
Here at Meet Margo, we’re all about sharing helpful info and insights on all things mortgages and finance. But just a heads up, our blog isn’t regulated by the Financial Conduct Authority and is for general information only and – t’s not intended as financial advice. For the nitty-gritty financial stuff, it’s always best to speak to an expert.
