Can I use gift funds to go towards my down-payment?
Saving for a down payment is one of the hardest parts of buying your first home. In fact, about 25% of first-time homebuyers get help with a gift from a relative as part of their down payment.
With most loan programs, a down payment gift isn't an issue. But some lenders require you to prove that you've provided most of the down payment yourself. You may need to provide documentation stating exactly where a down payment gift came from. This will include a letter from the giver, and possibly even some bank records from the giver. Lenders require you provide this information so they can make sure the gift isn't actually a loan.
Finally, make sure your family member considers federal gift tax regulations. If you're getting a large gift, the giver may need to pay a special tax on the amount.
I have years of experience in handling all types of real estate transactions and would be more than happy to answer any questions. If you're looking to purchase or sell a home soon, don't hesitate to give me a call.
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✔️Tawana Bourne, Broker - REALTOR® - Investor
📞 (Mobile/Text) 860.834.1220
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*Disclaimer. Q&A’s are for marketing purposes only and are not intended to offer real estate advice to non-represented parties. Please consult with a real estate professional under their contractual representation for answers to your real estate questions.