My parents loaned us $200,000 for a house deposit but now my boyfriend claims it was a gift - The Ex-Files

Q: My boyfriend and I bought our first home around a year ago. My parents transferred us $200,000 to help with the deposit. There was no written loan agreement, but my parents have always referred to the money as a loan and expected us to repay the money when we could.

We have been together for six years, but recently the relationship has become a bit rocky. We have discussed potentially selling the property. My boyfriend is now telling me that his recollection is that the $200,000 was a gift and we do not have to repay it. My parents are adamant and say they want the outstanding amount repaid.

Gift or loan

A gift is provided without any expectation of repayment. However, a loan creates an obligation to repay the money even in circumstances where repayment arrangements may seem informal or flexible. The law recognises that funds given to children by their parents may be presumed to be a gift and the Court of Appeal has recently confirmed this as money given to the child out of the love and affection a parent has for them. However, a parent may not feel the same way about giving money to a partner or an in-law.

To understand how the law determines whether money provided by parents is a gift or a loan, and what evidence may be relevant, read the full NZ Herald Ex-Files article here.