Can I Get a Gift for a Down Payment?

Find out how you can get a gift for a down payment with Accunet Mortgage. Accunet President Brian Wickert breaks down the topic and explains two different ways you can finance a home using a gift from a family member or loved one.

Video Transcript:
Welcome to Accunet Answers. The question that I want to answer in this segment is “Can I get a gift for a down payment?”

The answer is unequivocally “yes” on almost every type of loan and loan product that we do here at a Accunet Mortgage, certainly all the most popular loan programs. The gift can come from any blood relative so grandparents, parents, siblings, cousins, aunts, uncles – also significant others, especially if you happen to be living together, or fiancés. You cannot get a gift, however, from the seller, the realtor, the builder, the lender – anybody who’s involved in the transaction. The gift can be used for the entire down payment, and it can also be used to pay closing costs and to establish your deposit into your property tax escrow account. Really, everything that you need to pay at closing can come from a gift.

There are two ways for a buyer to receive gift funds – the hard way and the easy way. The hard way is for the donor, let’s say your grandmother, to give you a check or personal check and you deposit it into your checking account that you’re going to use to buy the home. The difficulty there, and it’s not too terrible, but there are several steps is that we have to get a copy of the front of Grandma’s check and then once the check clears we also have to get a copy of the back. And what lenders are trying to do here is make sure that someone doesn’t do the old switcheroo and substitute a check from the real estate agent, for example, and substitute that for Grandma’s check. We have to see that Grandma’s check in the case of a personal check has actually cleared her account. Then we also have to document that money going into your bank account so that typically involves getting a copy of the deposit slip or a screenshot from your online banking.

Now let’s talk about the easy way or Accunet’s favorite way for gift funds to be transferred, and that is via a cashier’s check from the donor, let’s say grandma again, to the closing agent, and that is done at the loan closing. By going this way we don’t have to document that Grandma’s check has cleared her account because it’s a cashier’s check payable to an independent third-party – the closing agent which is typically a title company. So that just cuts out a lot of annoying steps, but we can handle it either way.

Getting a gift for a down payment or a closing cost can be a really smart way to help people either buy their first home sooner than they otherwise would or buy a larger home than they otherwise could afford if they hadn’t gotten more down payment.[elementor-template id=”10109″]