When a buyer is receiving “gift funds” from a relative for a purchase, it is imperative that the funds go straight to the Title or Escrow Company. We beat this dead horse often, but we continue to get buyers who have received gift funds into their own checking accounts, creating “paper-trail” nightmares.
GIFT FACTOIDS: (1) Any “relative” can provide gift funds; this includes “aunts” and “uncles” who do not have to prove their relationship; (2) Gift Funds for Conventional Loans (non-FHA) that go straight to Escrow do NOT have to be “paper-trailed” – a HUGE convenience for the Donors; (3) Gift Funds for FHA loans have to be paper-trailed no matter what (Donor’s have to provide proof that they have/had the funds to give away – the so-called “ability to gift”).
Call Jay Voorhees at (925) 855-4491
Real Estate Broker, CA Bureau of Real Estate, BRE# 01524255, NMLS# 335646