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Because we own 2 properties, we need to have $18,000 approx. in reserves for our closing. We are getting different answers from the people at the bank, but can we use a gift as our reserves or is that not allowed?
Because we own 2 properties, we need to have $18,000 approx. in reserves for our closing. We are getting different answers from the people at the bank, but can we use a gift as our reserves or is that not allowed?
Thanks!
It probably depends on the lender, but if you find one that accepts it, you will need a gift letter from the generous giver stating that the money is a gift which requires no repayment. If the gift is recent (probably 2 months or less), the gifter may have to show the source of the funds (to show that s/he was in a position to actually make a gift).
Hmmm...thanks. We won't need to borrow that entire sum and we have a relative who is willing to give it us. We are just having issues communicating with the bank and we've had different information from different people. Well, I'm glad to hear it isn't an industry wide rule.
Hmmm...thanks. We won't need to borrow that entire sum and we have a relative who is willing to give it us. We are just having issues communicating with the bank and we've had different information from different people. Well, I'm glad to hear it isn't an industry wide rule.
To eliminate the previously mentioned "hurdles", it would help if you have the necessary funds in your account for the previous 2-3 months ("seasoned" money). If the lender never sees you "without", the question of where it's coming from would be a moot point. So if you're going to get the money as a gift, get it NOW rather than later.
Reserves may never come from gifts.........however, most loan programs do not require your down payment and closing costs to be your own and may be a gift.........so, while it's splitting hairs, if you have enough of your own money for the reserves, the rest of the funds you need may, indeed, be a gift (for Fannie Mae financing).
Another thought provoker. I think that is what our underwriters may be up to; moving our money around, but we are having trouble communicating with them. Today is our deadline for them, before we start talking to other companies.
Last edited by relocating_family; 07-20-2012 at 06:51 AM..
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