Proof of deposit: where can your mortgage deposit come from?

Once you’ve found the property and agreed the purchase price, the next step is making sure your mortgage lender can see where your deposit has come from. This is usually referred to as proof of deposit.

Lenders need this information as part of their legal and compliance checks. Having the right evidence ready can help reduce delays and keep your application moving.

Why lenders ask for proof of deposit

Mortgage deposits aren’t just about having the money available. Lenders also need to be confident the funds are legitimate and that the transaction makes sense.

In practice, proof of deposit helps lenders:

• meet anti-money laundering and source-of-funds requirements
• understand whether the deposit is from your own savings, a gift, the sale of an asset, or another acceptable source
• assess whether any larger or unusual payments can be explained clearly

Your broker, lender and solicitor each play a part in these checks, and the timing can vary depending on the type of deposit.

When proof of deposit checks happen

Proof of deposit is typically requested at different points in the process:

• Early in the application: you’ll usually be asked about where the deposit will come from so the right documentation can be planned.
• At application stage: the lender will review your evidence before progressing your application.
• During conveyancing: your solicitor will also complete their own compliance checks as part of the purchase.

Because some deposit sources require more paperwork than others, preparing evidence early can make a noticeable difference.

Where can a mortgage deposit come from? (and what proof is usually required)

Different lenders have different preferences, but most will consider a range of common deposit sources. Below are typical examples of what you may need to provide.

1) Savings (your own money)

If your deposit is built up from your income over time, lenders usually look for a clear savings trail.

What you’ll typically need:

• bank statements covering the relevant period (often several months)
• evidence that the deposit funds are coming from your account(s) and can be explained as part of your normal financial activity

Tip: If you have a larger one-off payment (for example, a bonus), be ready to explain it and show it appears in the account in a way that matches the story.

2) Gifted deposit from a relative

A gifted deposit can be accepted, but lenders generally want to be sure it’s genuinely a gift—not money that needs to be repaid.

What you’ll typically need:

• a gifted deposit letter confirming the amount and that it is a no-strings-attached gift
• confirmation that the gift-giver has no legal interest in the property
• evidence of the donor’s identity and, in many cases, their source of funds

3) Sale of other assets (for example, a car, jewellery, or valuables)

If your deposit comes from selling personal items, lenders will usually expect a paper trail.

What you’ll typically need:

• evidence of the sale (for example, statements or records showing the transaction)
• bank statements showing the money arriving into your account
• evidence of where the funds came from before they reached your account

4) House sale (using proceeds from selling your current property)

If you’re funding your purchase partly from the sale of another property, the lender will want to see sale evidence.

What you’ll typically need:

• proof of the sale (such as a memorandum of sale)
• if the sale is complete, the relevant completion statement
• where applicable, mortgage redemption or final statement details showing how the proceeds will be used

5) Inheritance

Inheritance can be an acceptable deposit source, but lenders typically want confirmation from the estate process.

What you’ll typically need:

• a letter from the executor/solicitor handling the estate
• evidence of the funds being transferred into your account

6) Sale of investments or shares

If you’re selling investments to raise your deposit, lenders will usually want to see the sale and the movement of funds.

What you’ll typically need:

• a statement showing the investment sale
• bank statements showing the proceeds landing in your account

Note: Some deposit sources (such as cryptocurrency) may require a more detailed paper trail to show the conversion and transfer into a UK bank account.

7) Pension funds (for eligible circumstances)

Where pension withdrawals are used, lenders will typically require evidence of the withdrawal.

What you’ll typically need:

• pension statement(s) showing the withdrawal
• bank statements showing the funds received from the pension provider

8) Compensation award

Compensation can sometimes be used as a deposit, particularly where it is paid as a settlement.

What you’ll typically need:

• documentation confirming the award/settlement
• bank statements showing receipt of the funds

9) Gambling wins (where accepted)

Some lenders may consider gambling winnings, but acceptance can vary and evidence requirements are usually strict.

What you’ll typically need:

• official confirmation of the win (for example, a receipt or operator statement)
• bank statements showing the money paid into your account

Important: Lenders may be cautious if the pattern of transactions suggests the deposit is not stable or is linked to frequent large gambling activity.

What can’t you usually use for a mortgage deposit?

While lender policies differ, there are some deposit sources that are commonly problematic.

Personal loans to fund the deposit

Using borrowing to create the deposit is often not accepted. Lenders generally prefer to see that the deposit is from your own funds or a genuine gift.

Gifted deposits from non-relatives

Some lenders may not accept gifted deposits from friends, employers, or distant contacts who aren’t closely related. The concern is often that it’s harder to evidence why the money is being given and whether it’s truly a gift.

Unproven cash payments

Large cash deposits can be difficult to evidence and may raise compliance concerns. Lenders typically need a clear explanation and documentation showing where the cash came from before it entered your account.

Practical tips for getting your proof of deposit right

• Keep statements consistent: ensure the account history matches the deposit amount and timing.
• Explain unusual payments: if there’s a one-off transfer, be ready with supporting documentation.
• Use clear documentation: letters and statements should clearly show names, dates, amounts, and the source of funds.
• Plan for extra checks: gifts and complex sources often require more paperwork than straightforward savings.

FAQs

How long does proof of deposit take to check?

It depends on the deposit type. Straightforward sources (like savings) can be quicker, while deposits involving gifts or multiple parties may take longer due to additional verification.

Can I use a loan to cover part of my deposit?

In most cases, lenders are unlikely to accept deposit funding that comes from a loan. They generally want the deposit to be your own money or a genuine gift.

What should a gifted deposit letter include?

Requirements can vary, but a gifted deposit letter often needs to include:

• the names and addresses of both parties
• the relationship between you and the gift-giver
• the gift amount
• confirmation the money is a gift (not a loan) and that there’s no expectation of repayment
• confirmation the gift-giver has no legal interest in the property
• the gift-giver’s signature

Do all lenders accept every deposit type?

No. Even where a deposit source is generally acceptable, lenders may have different documentation standards or restrictions. Preparing evidence early and ensuring it matches the lender’s expectations can help.