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CENTURY 21 ACADIA REALTY
Phone
(985) 446-6363
Fax
(985) 446-6368
Toll Free
(800) 528-6005
E-Mail Us
509 Canal Boulevard
Thibodaux, LA 70301 |
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Questions & Answers
Get the answers on home selling and buying.
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Parent Gifts - Q & A
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Q:
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Do I have to disclose a parent's gift?
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A:
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Having generous parents is nothing to hide. An estimated one-third of first-time buyers purchase their home with a loan or a money gift from their parents. Lenders will ask for a gift letter stating that no repayment of the "gift" is expected. In addition to the letter, a lender can ask for two or three months' worth of statements for the account where the down payment funds are located. If the money was recently placed into that account, the lender may ask where it came from and request verification of that source as well. Resources:
* "The Homebuyer's Survival Guide," Kenneth W. Edwards, Dearborn Financial Publishing, Chicago; 1994.
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Q:
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What is a gift letter?
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A:
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If someone is willing to make a gift of funds in order for you to purchase a home, lenders will ask for a gift letter stating that no repayment of the "gift" is expected. The amount of the gift and the date funds were transferred should be spelled out in the letter, along with the donor's name, address, telephone number and relationship to the borrower. In addition to the letter, a lender can ask for two or three months' worth of statements for the account where the down payment funds are located. If the money was recently placed into that account, the lender may ask where it came from and request verification of that source as well. Gifts -- with the proper documentation -- can be from relatives, friends, an employer, church, municipality, or nonprofit organization. Lenders often have stricter restrictions on gifts from friends and relatives other than parents. Also, if you put less than 20 percent down, some lenders may require that a portion of the down payment be your own cash, not a gift. If you want to use a gift as part of your down payment, check with individual lenders to learn the restrictions of specific private or government-insured mortgage programs.
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Copyright 1999 Inman News Features
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Home Advice
Get the answers on home selling and buying.
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Century 21 Real Estate LLC supports the principles of the Fair Housing Act and the Equal Opportunity Act. Each Office is Independently Owned and Operated. CENTURY 21® and the CENTURY 21 logo are registered marks owned by Century 21 Real Estate LLC and used by CENTURY 21 ACADIA REALTY with permission. All other trademarks and service marks are the property of their respective owners. Neither Century 21 Real Estate LLC nor any of their respective franchisees affiliated companies provides any product or service described herein. Not all products and services are available in all states. All products and services are provided by the applicable service provider described herein.
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