Can You Take From Family For Mortgage Down Payment

Performance Property Real Estate Question

Q: My boyfriend and I are trying to buy a home. We don’t have much savings. Can our parents help us with the mortgage down payment? Kelly, Bloomingdale, NJ

A: Family and friends can help home buyers with good credit and income who lack enough money for a down payment to purchase a home. A monetary gift from family or friends may help home buyers get a lower mortgage interest rate or eliminate the need for private mortgage insurance (PMI). You can use monetary gifts from friends or family members for your mortgage down payment, so long as you provide a signed statement to your lender that the money is a gift and not a loan. It is best to discuss gift funds up front during the mortgage pre-approval process. An experienced mortgage broker should be able to walk you through the process and give you a detailed breakdown of the specific documentation required and how much of your down payment can come from a gift. Thanks for your question, Kelly.
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