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Attyadvisor, Attorney
Category: Real Estate Law
Satisfied Customers: 6729
Experience:  29 years of experience in General Practice, Real Estate Law and Estate Law.
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Hi, I am weighing different scenarios, there fore question

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Hi, I am weighing different scenarios, there fore question is around the same lines as the previous questions. I would like to know if a kid wants to buy a rental property and is short of the 20% down payment, can parents provide a gift so the 20% is made up so he is able to buy the property. I am asking this since I was told that gifts are not acceptable for investment properties. the whole fund has to come from the individual. Is this true. Thanks

Welcome and thank you for your question. I will be the professional that will be assisting you.

That would depend on the type of loan and the lender. If he qualifies to make the mortgage payments on his own. Does the lender need to know the down payment was provided as a gift?

Customer: replied 3 years ago.

I do not know. I just know by word of mouth that gifts are not accepted to buy renting properties.

You would want to check with lenders your child would consider using to finance the loan. They all have different underwriting conditions.

If the lender cannot determine a method that would allow this type of gift, they would be able to tell you if the child can qualify or if they need a co-borrower.

Sometimes the money just needs to be an account for a certain period of time before making the application. I found the lenders to be very forthcoming with regard to the requirements.

I hope that helps.

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