A gifted deposit is a deposit (or a portion of a deposit) paid by the developer, house builder or a private seller.
A gifted deposit from a private seller will mean that he/she will need to sell the property to the buyer at an over market value. This will help the buyer to apply for a larger loan. Afterwards, the seller passes on the difference to the buyer, who then pays it to his solicitor as the deposit. This results in the buyer purchasing the property with no money down.
When a property is sold at 30% below market value the buyer applies for a bridging loan at 70% LTV. Effectively, the 30% reduction will be the deposit as equity in the property. The buyer then remortgages for 85% of the actual value, usually after refurbishing the property to achieve an over market value price, thereby releasing the profit from the price difference.
As discussed before if you use a joint venture partner who is prepared to fund the investment then