Down Payment Gift Letter Template Td. A gift letter for a mortgage down payment is a written statement that the funds are a gift rather than a loan that has to be repaid. In order to use the gift of equity, a client must include a gift letter, just as if they were being given a cash down payment.
Use this mortgage gift letter template if your lender has specifically asked for a statutory declaration. Before deciding to use gift money for your down payment, you should check for the rule and regulations of gift money from your mortgage lender. When you make a bigger down payment, you pay less interest.
Without the letter, the irs could tax the donor for up to 40% on the gift amount.
They want the down payment to be *your* money (gift or otherwise). But they also require the borrower to obtain a gift letter from the person(s) providing the funds. The donor is an immediate family member. The money is a genuine gift and does not have to be repaid.