What do you think

You can't cherry pick morality to suit. It's black or white, not 5O shades of grey.

I hadn't looked at it like that but, yes, that's a very valid point. After all, the Mortgage company might well not have lent the money or as much if you had said it was a loan.

You signed a legal document saying it was a gift. Morally you think the money is yours, legally it is not. You should have signed that it was a gift to your offspring ( as opposed to the coupe ) and it could then have been ring fenced in case of future problems.
My daughter borrowed money for a deposit for a house with then partner which she paid back over time. They split later and she got the deposit back plus a fair share of the profits. She still has that money for a future deposit. There was nothing in writing but her ex accepted that the money belonged to her even though as he was the bigger earner he paid the lion's share of the mortgage.

Hindsight is a wonderful thing.
I feel for those who are or have been in the same position.
Thank you to those of you who understand.

To those who disagree with my outlook, I appreciate your opinions and comments.

In summary - We were asked to help with a loan and yes, the mortgage company required It to be a gift. So we without hesitation signed the document. We were naive to have placed our trust.
A lesson learned.

Thank you all again.

Coolgran65, it may be disheartening that the trust in your in-law has been broken, but try to look on the positive side that your offspring is happy to give the deposit back.

I agree with your husband. Let it go. Money is not worth the anguish that it causes. Personally, I wouldn't have given it in the first place. I'm a great believer in letting children stand on their own two feet. If they couldn't afford the deposit then they move into rental. Owning a property doesn't make people any happier, as your son and wife have proved and it's certainly made you unhappy. I do agree with other people morally it should be returned, seems where money is concerned some people have no morals.

We gave DD and SIL a substantial sum of money, allowing them to buy a bigger house without adding too much to their mortgage. Unfortunately, I realised, through not having to sign that above mentioned document, that the money probably used for the intended purpose. It presumably gave them a safety net, but I was angry. That sum will not be 'recovered ' if the house is sold. I asked my solicitor if I could ask SIL to sign a document stating that if they were to part and sell the house, he would give DD 'that sum' before they split the remainder of the sale money. He said that could be done, but he couldn't be 'held' to it. We would have to rely on his goodwill!

The money isn't the important part though of course not irrelevant.
It's about doubting my/our ability to judge character.
One thing is for sure, it'll be a cold day in hell before it will happen again.

Okay, I know the way to go. Store it away and file it in the 'down to experience folder'.

If it's all about character judgement then, even if you did press for the money and were successful in getting it back, it wouldn't make up for that person not being who you thought.

I think that you don't lend money unless you are prepared for it not to be paid back (i.e. a gift), unless legal forms are signed. My daughter has, bless her, a spread sheet of all the money that I have provided. I never expected it to be paid back and, if they tried, it would take long after I would be dead.

Coolgran,
We all think we can judge character which we do by past behavior but we cannot predict the future, couples in particular are impossible. In my extended family there have been several divorces of couples that we thought were a good match, conversely others have stayed together when nobody thought it would last.
A lot of us Grand parents have cash to spare ( I don't) giving or loaning money to a young couple can unbalance their relationship, giving cash to a daughter might make a man feel inferior, there is no easy option.