FHA is updating guidelines to more mirror Fannie Mae and Freddie Mac guidelines when a home buyer is getting a gift to help purchase a home.

If you are getting a gift, here is what you need to prove and document that gift to your mortgage lender affective immediately (July 2024)

Gift Letter

The gifting person, and the receiving person must both sign a ‘gift letter’ that your Loan Officer will provide to you.

Provide one of the following for gifts verified prior to closing:

• A copy of the Donor’s bank statement showing the withdrawal
• Evidence of the deposit into the borrower’s account (receiving person’s bank statement)
• Copy of the donor’s canceled check and evidence of deposit into the borrower’s account;
• Copy of the donor’s withdrawal receipt and evidence of deposit into the borrower’s account; or
• Evidence of the electronic transfer of funds from the donor’s account to the borrower’s account.

Obtain one of the following evidencing payments to the settlement agent for gifts given AT closing:

• Evidence of electronic transfer of funds from the donor’s account to the settlement agent;
• Line item on the CD reflecting gift funds received does not evidence electronic transfer of funds
• Bank certified check;
• Cashier’s check; or
• Other official bank check.

Confused About Gift Requirements?

Mortgage loan guidelines can easily be confusing. No worries, if you have any questions, simply reach out to our FHA home loan experts at (651) 552-3681. We will be more than happy to answer your questions.

Notes:

• Regardless of when gift funds are made available to a borrower or settlement agent, a reasonable determination must be made that the gift funds were not provided by an unacceptable source.