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Can all of the down payment come from a gift and who can be the donor?

Happy Friday!

On single family homes, ANY funds needed for the down payment and/or closing costs can come from a gift. This goes for conventional and FHA. (VA and Rural Development still allow for $0 down.) Conventional used to require 5% of the purchase price come from the buyer’s own funds but that changed awhile ago and 100% can now come from a gift.

Regarding WHO can gift funds to a buyer, both conventional and FHA allow…

  • a relative, defined as the borrower’s spouse, child, or other dependent, or by any other individual who is related to the borrower by blood, marriage, adoption, or legal guardianship; or
  • a fiancé, fiancée, or domestic partner.

But notably, FHA will also allow gifts to come from a buyer’s EMPLOYER!

I’ll be available all weekend if you have a client who needs to be prequalified before Monday!

Have a great weekend!