mm - as a conveyancing solicitor, I know that the lender's are not happy with these arrangements unless fully disclosed to them. Under the CML rules (Council of Mortgage Lenders ) rules, the price on the contract must be the price you pay and any incentives should be reported. Sure there are might be unscrupulous solicitors who might take your money and not report the fact to the lender but I certainly wouldn't risk my practising certificate on it. No chance. The lenders will lend against what you are paying not against market value. The value is almost insignificant. The paperwork must reflect the true price (eg if you are paying £170k the contract MUST state £170k and any 'gifted deposits' must be reported to the lender (if the solicitor is worth their salt) Not sure this would work to be honest froma legal perspective but I'm willing to have a debate about it.
