Tighter mortgage guidelines since late-2008 are forcing home buyers to make bigger downpayments. Anecdotally, the change has led to a surge in buyers taking gifts of cash from family members. If you’re among those accepting a cash gift from family, it’s important to know that you can’t just deposit the money in your bank account. There is a proper way to accept a cash gift and it requires 3 distinct steps:
- Complete and sign an acceptable gift letter
- Document the gifter’s withdrawal of funds with teller receipts
- Document the giftee’s deposit of funds with teller receipts
See, mortgage lenders pay close attention to gifts-for-downpayments. For one, lenders have to make sure that downpayment cash is “clean” (i.e. not laundered). And, secondly, they want the gift to really be a gift and not a loan-in-disguise. This is why lenders will often require that a signed, dated letter accompany the home loan application. As an example…
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Sincerely and respectfully,
Daniel A. Sosa
PMZ Mortgage Consultant
Office: 209-472-2010 x4716
Cell: 209-298-8017
Email: dsosa@pmzloans.com
Website: www.loanapproval411.com
