If you’ve been gifted a down payment, there may be strings attached—from the mortgage company. I’m Amy E. Feldman.
A couple called into a Connecticut radio show to ask if they should take the bride’s parents’ offer to give them cash for a down payment instead of paying for a big wedding. Judging by statistics, that couple is not alone. A survey in Canada found forty percent of young homeowners received financial help from parents. But if you’ve been offered a gift toward the purchase of a home, there are a few legal considerations.
First, a gift by an individual of more than sixteen thousand dollars per person has to be reported on the gift giver’s taxes. The recipient doesn’t have to declare it on tax forms but may have other paperwork because if the mortgage lender sees new money in your bank account, they may want to see a letter showing that the money was a gift that you do not have to repay. Regardless of paperwork though, most listeners thought the couple should take the downpayment and elope to Vegas.
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