Using Gift Money To Secure Your Loan

Congratulations on your decision to buy a house! Chances are you may be getting a gift to help secure the mortgage on that house, so we wanted to give some guidelines in receiving and using that money!

Conventional –Fannie Mae
Gift Donors may be a relative, such as the borrower’s spouse, fiancé, domestic partner, child (or other dependent), or any other individual related by blood, marriage, or adoption (or legal guardianship).

  • The donor MAY NOT be—or have any affiliation with—the builder, the developer, the real estate agent, or any other party interested in the transaction.
  • Gifts are NOT allowed for investment properties.

Conventional – Freddie Mac

  • Gift Donors may be a relative, such as a blood relative, spouse, fiancé, domestic partner, or legal guardian.
  • The donor MAY NOT be—or have any affiliation with—the builder, the developer, the real estate agent, or any other party interested in the transaction.
  • Gifts are NOT allowed for investment properties.

FHA Loan

  • Donors can be a relative as defined below*, or a close friend with a clearly defined and documented interest in the borrower.

”Relative” is defined as follows, regardless of actual or perceived sexual orientation, gender identity, or legal marital status:

    • Child (son, stepson, daughter, stepdaughter, foster child, or adopted son or daughter, including a child who is placed w/the borrower by a legal adoption agency)
    • Parent, step-parent, or foster parent
    • Grandparent, step-grandparent, or foster grandparent
    • Spouse or domestic partner
    • Brother or step brother
    • Sister or stepsister
    • Uncle or aunt
    • Son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law

VA Loan

  • You must be able to document that the gift funds come from an acceptable source — a family member or someone with a family-like relationship — with a legitimate paper trail via a bank account or financial institution.
  • No one involved in the loan transaction, including the lender, can be the source of the funds.

Who ever gifts you this money is helping you achieve a dream, and could position you in a great spot with regards to your new mortgage! Be sure to thank them in a grand way for their generous gift!

Sources:
Kim Kirk – SPMC.com
Veteransunitied.com

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