Mortgage Glossary
Gift Funds
Defined by Onias Derilus, Mortgage Capital · NMLS# 1859012 · Florida licensed mortgage broker
Gift funds are money a relative or qualifying party gives a homebuyer toward the down payment or closing costs, with no expectation of repayment.
What Gift Funds means
Most loan programs allow gifts with a signed gift letter and a paper trail showing the transfer. The funds cannot come from anyone with an interest in the sale, like the seller or agent.
Florida example
A Florida buyer receives a $20,000 gift from a parent for the down payment. The lender documents the donor's account, the transfer, and the gift letter to confirm it's not a hidden loan affecting DTI.
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