5 Thoughts on What are the stipulations regarding money for a downpayment on a mortgage loan?
  1. Reply
    February 15, 2014 at 1:55 am

    they must be sourced (where did they come from) and seasoned (in the bank for at least 2 months) or with FHA they can be gifted by a relative

  2. Reply
    David Z
    February 15, 2014 at 2:23 am

    A lender mostly will not allow the downpayment to be a loan from someone else.

    They will review your bank statements for a couple of months. If they see a large deposit they will want some documentation as to what it is to verify it is not a loan. if the money has been in account for a few months they will be fine and will not ask any questions.

    A down payment as a gift is ok but they will require some documentation from party giving it that it truly is a gift.

  3. Reply
    February 15, 2014 at 2:49 am

    My dad paid the down payment on my home and it had to be deposited in my bank with proof by bank statement provided to the lender prior to closing. Also, we were required to sign a “Gift” letter stating the source of the money and it had to be notarized. The loan was FHA.

  4. Reply
    Ann A
    February 15, 2014 at 3:14 am

    Many loan programs will require 3-5% of your own funds. For conforming loans 20% down can come as a gift and seller pay closing cost is allow.

    FHA mortgages will allow the whole thing to be a gift from an approve source, parents, kids, grand parents, brothers, and sisters, NO cousins. always approve grants and Real estate brokers involve in the transaction might assist with the down payment. Check with your FHA lender.

    If the funds are require they must be in your acct 60days prior to the loan application underwriting date. This is call seasoning of funds

  5. Reply
    February 15, 2014 at 4:03 am

    You’ll need to be able to show the source for the money. If it was savings you kept at home until now (what we call mattress money or cigar box money) you’re pretty cooked. They want to see that it’s not money you got from an illegal source, like drug money. If you make a $ 50,000 deposit tomorrow, they want to know where you got it. Did you sell something(s)? Did you inherit it from your long lost Uncle Lou? Did you get it from terrorists?

    If it was a gift, you’ll need the donor to write a letter explaining the amount of money given, and declaring that you will not be asked to pay it back. Even if you get someone to give you money for a downpayment, there are limits on the amount you can be given.

    If the seller pays some closing costs, there are again limits, based on the amount and type of loan.

    Ask your lender about it. If you’re planning to buy a property, you should be getting preapproved by a lender before you make any purchase offers.

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