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My lender is asking me to prove my relationship with a family friend???

I was gifted a sum of money from a close family friend to help with my down payment, and now my lender is asking for "proof" of the relationship. Is this normal? It seems like a strange request to make. by andreasmom162 from Helendale, California. Oct 13th 2015 Reply


William J Acres (William_Acres)
#2 ranked lender in Arizona - 7,797 contributions

More info is needed as the guidelines are different for FHA vs. Conventional.. But It's is normal and it's what the guidelines call for.. For conventional, it can only be a family member, fiance or domestic partner. For FHA, the guidelines state "a close friend with a clearly defined and documented interest in the borrower" This means you have to prove you have a long term relationship with this family friend.. In the past, I was able to use old facebook photos to document a relationship, but there are other ways.. Talk to your lender, they should be able to share with you a list of acceptable proof to satisfy this condition. 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. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com NMLS# 226347

Oct 13th 2015
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Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 3,446 contributions

The very long standing standard mortgage loan rules require gift money to be from a blood relative, or a substantial person with a documented interest in the buyer. A common example of this is a fiancee, or boyfriend or girlfriend. You don't mention who is the gifting person, but it can't just be anyone.

Oct 14th 2015
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Jericho Cherry (Jerichocherry)
#58 ranked lender in Virginia - 1,107 contributions

Ask him what type of proof he is looking for.

Oct 13th 2015
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Chris Neuswanger (mtnmortgageguy)
#94 ranked lender in Colorado - 84 contributions

Mortgage gules often lack common sense to most people, but this is a common request in such a situation. Many loan programs only allow gifts from family members, but William is correct if this is a FHA (or possibly a portfolio lender)application you will be asked this. The lender might accept a letter from a family member or other 3rd party attesting you have been close friends with the donor, old photos or yearbooks are good, ask the lender what they consider acceptable proof,

Oct 14th 2015
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Jennifer Binford (jbinford@prmg.net)
#1292 ranked lender in California - 2 contributions

I am a Mortgage Underwriter and with FHA's 4000.1 handbook that came out, Cousins are not acceptable donors anymore, therefore we have run into this request to use a close friend with a clearly defined and documented interest in the borrower. Typically a Letter of Explanation regarding the relationship and how long they have known each other signed by both and perhaps a photo from them together at Christmas or another Holiday that they share together many years ago or in some cases they have joint accounts (i.e. bank account, credit card (authorized user), timeshare, etc.). I have even had instances where they document they are the Godparent (photos and documentation from baptism) to one of their children or went on vacations together. This would document a clearly defined interest in the borrower.

Apr 26th 2016
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