Home Purchasing Secrets

GIFT FUNDS FOR HOMEBUYERS
QUESTION: Are you planning to buy a home, and short on cash?

It might be to your advantage if you read up on the subject. Listed below are some helpful pointers on cash gifts for down payments. The specifics vary from between programs.

CONVENTIONAL LOANS
• GIFT FUNDS must come from family members, a church, municipality, or non-profit agency.
• GIFT LETTERS must include the amount, purpose of the gift, and grantor signature.
• VERIFICATION of the gift fund transfer requires documentation.
• GRANTOR must not require repayment of the gift funds.
• DOWN PAYMENT buyers must have at least 5% of their own funds.
• CLOSING COSTS pre-paid items, like interest and taxes may be a gift.

VA LOANS
• GIFT VERIFICATION is required.
• GIFT FUNDS may come from any person, regardless of relationship.
• DOWN PAYMENT & CLOSING COSTS may be a gift, regardless of percentage down.

FHA LOANS
• GIFTS of entire down payment are allowed regardless of percentage.
• GIFT LETTER & FUND VERIFICATION is required.
• GIFT ORIGINATION may be from a family member, employer, labor union, charitable organization, government agency, housing assistance program, or a close friend who has a significant interest in the buyer.

COMMUNITY FUNDING PROGRAMS
Many communities have special funding to help first time buyers, and those have not owned in three years or more. Funding ranges from down-payment aid, tax relief, tax credits, below market interest rates, and grants. Contact any city hall for information on special funding availability.

This newsletter provided by:
ORCHARD REALTORS
314-962-0962