The holidays have a way of putting everyone in a generous and giving mood. For the most part, that mood is expressed with gifts of the latest tech or sweaters knitted by Grandma. But what if you could give somebody the opportunity to become a homeowner?
When thinking about Christmas presents, down payment gifts aren’t usually the first thing to come to the mind. However, if you have a lucky someone in your life that you’d like to help along the path to homeownership, there are a few details to cover so that you can successfully achieve this goal.
Who Can Give Down Payment Gifts?
For almost all types of mortgages, the down payment gift must come from a relative, a fiance, or a domestic partner. Furthermore, they cannot have any affiliation with other parties who have a vested interest in the transaction such as the real estate agent or the builder.
It’s worth noting that in some circumstances, a gift down payment can come from other sources, but it varies with certain loans. If you are unsure if you can receive gift funds from a person, be sure to speak with your loan officer before you take any additional steps.
Documentation
For down payment gifts, you will need to be able to show where the money came from and the process in which it was transferred to the recipient’s account. Your lender will likely need:
- A gift letter essentially stating the amount of the gift and confirming that the funds are a gift not expected to be paid back at any time (the format for this letter is typically provided by the lender)
- Documentation showing the transfer and receipt of funds such as bank statements and copies of the cleared and cancelled checks
As it turns out, giving a down payment gift can be relatively simple, not to mention one of the more impactful gifts a person can receive. If you have any questions about how to move forward with your down payment gift, please give us a call at 321-265-4000 to speak with a loan officer today.