Down payment funding alternatives
For many buyers, especially first-time buyers, saving up the funds for the down payment can be a seemingly insurmountable hurdle to home ownership. This doesn’t have to be the case. As your mortgage broker, we can help you find creative ways to come up with your down payment.
Using a gift for your down paymentOne way to fund a down payment is by using a gift. For many loan programs, a gift may be used for a portion or all of the required down payment. Money given as a gift for a down payment can’t come from random sources. Family members are the usual source. If this is an option open to you, please let us know. We can help you determine which loan programs accept gift funds for down payments and who may give the gift. We will supply the gift letter that the person giving the gift is required to sign. The gift letter states that the funds are a gift and will not be paid back.
Sourcing & Seasoning of Gift Funds
Lenders are quite particular about where the funds come from. They also want to make sure that the family member who is providing you with the gift will not suffer any hardship. Prepare your family member for a request of his/her bank statement and a 'paper-trail' to show how the money moves from their accounts to yours. We will guide you along, just let us know when you are ready!