Posted by Terri on February 27, 1999 at 15:40:55:
In Reply to: Down Payment posted by Matt on February 17, 1999 at 12:09:54:
Be Careful with Gift Money!!! I just bought a home, here's my story:
I was pre qualified with an out of state lender who quoted me a high interest rate. After finding a home I liked, I decided to go with my local Fleet Bank for my mortgage, they were able to offer a lower rate. At that time I realized that the first lender had underestimated my closing costs by several thousand dollars. My local bank person (not sure of her title), who took my application, advised me to get a "gift" for the difference. I asked what she needed. She told me to get a certified bank draft from the individual giving me the money and have them sign a "gift letter." According to her, that's all they needed. She was wrong.
Months later, I'm wondering why my mortgage commitment hasn't come in. Turns out, the processor and underwriter, who are located in a different state, need to research the gifter's bank records. They need proof that the money I'm using came from this person's bank account. They need his bank statements and withdrawl slips, etc.. (Mind you, he's not the one buying the house, I am)
Well, this person was not willing to have me or a strange bank research his financial history, so I had to save my own paychecks to cover the amount of what I was originally going to use the gift for. In a nutshell, the giver of the money needs to be willing to be investigated just as thoroughly as the buyer of the house, some people are not comfortable with that invasion of privacy.