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Can down payment be a gift from family for FHA?

We are buying a first home using FHA Loan. Can the down payment be a gift from a family memeber? by HectorEsplana from Victorville, California. May 28th 2013 Reply


Steven Ceceri (CreativeFinancingOptionsGroup)
#37 ranked lender in Massachusetts - 723 contributions

Good Afternoon Hector! A Gift can come from many acceptable sources, including a family member. As noted by others, there is a documentation requirement that needs to be followed, starting with a Gift Letter where your family member states that they are giving you a Cash Gift and that this Gift is not repayable at any time. Also, they will need to provide proof that they do have the necessary Gift Funds in an account of their own. Our process is fairly simple, so if you need a lender that can help with your loan application for your first time purchase, I would be happy to help! Thank you and enjoy the day!

May 28th 2013
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William J Acres (William_Acres)
#1 ranked lender in Arizona - 8,455 contributions

Yes.. there are specific rules in place, but it is absolutely allowed.. the fact that your asking this question tells me you have not contacted a loan officer yet, since one of the questions a loan officer will ask is "where is the down payment coming from".. so, if that's the case, then you should contact a LOCAL mortgage broker and apply with them. Do not use the local "Big" bank, or one of those 50 states internet lenders or nationwide lenders...By applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with numerous lenders, seeking out the best loan terms for your particular scenario. Because he has lower overhead, he can offer you lower rates and lower fees than most of the larger lenders.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

May 28th 2013
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Tim Howard (TimHoward)
#74 ranked lender in Ohio - 52 contributions

Yes the down payment can be gifted. There may be minimum credit score requirements by the lender though. Check with a local broker or banker to get specifics on guidelines concerning gifted down payments. Good luck!

May 28th 2013
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Jericho Cherry (Jerichocherry)
#57 ranked lender in Virginia - 1,107 contributions

Yes it can. Check with a lender in your area for all the details.

May 28th 2013
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J.D. Peck (MortgageColoradoSprings)
#45 ranked lender in Colorado - 77 contributions

Yes however, there will be a requirement of source of funds from the gifting party meaning that the underwriter will condition that there is evidence that the family member did not borrow the funds to gift to you.

May 28th 2013
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Carlo Sanchez (MortgageLendingPro)
#0 ranked lender in Utah - 1,163 contributions

Absolutely!! Gift funds can come from a family member, Government Entity, or or employer.

May 28th 2013
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James Mazzola (Mazzola)
#111 ranked lender in New Jersey - 313 contributions

Yes the down payment can be gifted

May 28th 2013
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Pete Bass (PeteBass)
#31 ranked lender in Connecticut - 476 contributions

Yes, The gift can come from a family member- The funds will have to be "sourced" from the party gifting your the money ( Gift letterplus cancelled check, Bank Check & Bank statement from the donor showing the funds leaving their account- a bank statementfrom your account showing the monies going into your account also- Please note that the underwriter will question any deposits that are not payroll on your bank statements- they would have to be sourced also- You may want to look into Down Payment assistance for 1st time homebuyers- contact a community bank in your area, they can help you with this as a option-Hope this helps,Pete

May 28th 2013
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Dave Metsker (DaveMetsker)
#37 ranked lender in Oregon - 2,317 contributions

Yes, family gift will work.

May 28th 2013
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Jeff Riley (JRILEY)
#0 ranked lender in Massachusetts - 17 contributions

Yes it can be.

May 28th 2013
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Carlos Figueira (carlosfigueira)
#109 ranked lender in New Jersey - 198 contributions

Yes, you can use gift for FULL down payment and all closing cost on FHA purchase.

May 28th 2013
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Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 3,791 contributions

You bet... Gift of down payment from a family member for FHA loans has been a tried and true method of purchasing a home for decades. www.JoeMetzler.com/fhaloans.htm

May 29th 2013
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Elden Lewis (elewis_409_299)
#41 ranked lender in Indiana - 223 contributions

The short answer is yes, there are some restrictions most have already been addressed these responses. I advise you shop around and you should include local banks in your search. There fee in a lot of cases can be far less than a brokers. That doesn't mean you don't call brokers. It means you do your home work and get GFE's from a mix of lenders and compare.

May 29th 2013
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Joe Shamie (Joe Shamie)
#5 ranked lender in New Jersey - 1,412 contributions

Absolutely!

May 29th 2013
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Jason Vondrak (jvondrak)
#217 ranked lender in California - 1,741 contributions

Yes, your down payment for an FHA loan can come in the form of a gift. You will have to provide documentation, however. Documentation includes a gift letter that states that the money is a gift and that it does not need to be paid back and bank statements showing where the money came from. You can find a template for a gift letter by selecting the "Gift Letter" option on this page: http://www.prospectrefinance.com/loan-application-forms/. We are licensed in California, so feel free to contact us with any questions.

May 29th 2013
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Stacey Nielsen (Unitywestlending)
#913 ranked lender in California - 123 contributions

Hello Hector, The down payment can definitely be a gift from a family member. You will need to provide proof that the family member has the necessary Gift Funds in a bank statement from the offering member. We are a local lender and would be honored if you called us for assistance. 714-881-5970

May 31st 2013
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Raymond Denton (Raymond)
#10 ranked lender in Ohio - 224 contributions

Yes, absolutely.

Jun 1st 2013
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Michael Kirkutis (MichaelKirkutis)
#34 ranked lender in Connecticut - 13 contributions

Yes, FHA allows gifts from a family member. In CT, the mortgage lender will ask for the documentation of the gift which usually is in the form of a gift letter. The letter will state something to the effect that the funds are a gift from your relative and no repayment is due back and usually signed by the gift donor. Also, the gift donor will provide proof of where the gift funds are coming from and then you will show proof of the transfer/deposit into your account. Good luck.

Aug 27th 2013
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