Posted on: 10th Feb, 2011 12:59 pm
My parents have cash on hands that they did not keep in their banking account. They want to give me the money for down payment. Can they deposit the money and write me a check? This would obviously show a large deposit in their bank account. Would they have to provide proof that they had the cash on hands? If so, what kind of proof would be needed?
Need proof of where the money came from.
You have to paper trail a gift just as you would your own assets
You have to paper trail a gift just as you would your own assets
paper trail. On FHA loans the deposit would definately be questioned. You could get the gift letter. and the bank can provide a letter stating that at the time they had "x" amount of dollars in the account and that was sufficient to purchase "x" amount of dollars for a certified check.
Or get the letter from the bank, a check from your parents. Deposit the check...then get a copy of the cancelled check from your parents.
The only way is to have the bank write a letter stating the amount of funds available, on letter head, signed and stamped by the bank.
It's a form of verification of deposit
Or get the letter from the bank, a check from your parents. Deposit the check...then get a copy of the cancelled check from your parents.
The only way is to have the bank write a letter stating the amount of funds available, on letter head, signed and stamped by the bank.
It's a form of verification of deposit
Elnora's tip is viable only if the bank on which your parents' check is drawn is amenable to doing that.
As a general rule, lenders now want to see specific proof that a gift donor has the werewithal to provide a gift - without any large deposits being a part of the deal.
Verifying the source of gift money is a major requirement in the mortgage industry - whether FHA, Fannie or Freddie. If you're dealing with a small lender that might be keeping the new mortgage loan in portfolio, you may be able to get away with it; but those lenders are ever more vigilant as well, wanting to have as many saleable loans as possible at all times.
As a general rule, lenders now want to see specific proof that a gift donor has the werewithal to provide a gift - without any large deposits being a part of the deal.
Verifying the source of gift money is a major requirement in the mortgage industry - whether FHA, Fannie or Freddie. If you're dealing with a small lender that might be keeping the new mortgage loan in portfolio, you may be able to get away with it; but those lenders are ever more vigilant as well, wanting to have as many saleable loans as possible at all times.
