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Full Financial Disclosures and Gift Letters

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My realtor faxed in my offer Monday morning on a home that seemed like an incredibly good deal. It’s a 2,400+ sq ft. place in Columbia, MD with four reasonably sized bedrooms (not counting the basement), three and a half baths, and a great deck. The offer I made was competitive enough to warrant the seller’s agent to request what is termed “full financial disclosure,” which meant I was to detail my job, salary, assets, and liabilities in a stock form provided by Century 21. The form was a little funny considering how it asked for the information but the Century 21 logo meant I could trust this was all the information they needed. What struck me as a little strange was that I didn’t need to provide any proof of any of this, though the pre-approval letter (where I did provide proof to LendingTree) did provide secondary proof.

The funny thing about the form, other than I didn’t provide any bank statements or pay stubs, was that in the listing of asset accounts it had checking, savings, credit union, and then an other category. Under checking and savings, there was only enough room for two accounts. I think in the age of online banks like ING and Emigrant, having only two savings or checking accounts is rare. Also, I have a checking and savings account at a credit union (through work and through my father’s work, since I opened those when I was a teenager) so do I count those in credit union or the regular checking and savings. I just went with putting it all in checking and savings and a small sum in the credit union – making sure not to double count any of the accounts.

The gift letter portion of the title refers to how I’m going to get money for the downpayment from my parents, specifically my father (someone has to be writing the gift letter, so it was my father). I searched for about ten minutes on Google and couldn’t find any example gift letter template, just a list of some criteria. Essentially, the letter just needs to say who is giving who money, that it is a gift, and that there is no expectation that the money will be repaid (i.e. the gift is not a loan). The money must be used towards closing costs or the downpayment by rule, but the letter doesn’t need to say this. I’ve provided an example gift letter template that I created myself and that my agent accepted and faxed to the seller.

To Whom It May Concern,
This gift letter is to state the fact that I intend to give to my [nature of the relationship], [your name], a gift of [dollar amount] towards the purchase of a home. This is not a loan and there is no expectation that this sum will be repaid.

Sincerely,

[your benefactor's name]
[date]

I should find out this morning whether or not I’m writing a “DENIED!” or a “I’M FANTASTICALLY POOR” follow-up post. :)

{ 22 comments, please add your thoughts now! }

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22 Responses to “Full Financial Disclosures and Gift Letters”

  1. michele.fournier says:

    Thanks so much for putting the gift letter sample up.
    Michele Fournier

    (Edit: Removed email address from the name, figured you probably didn’t want spam.)

  2. Adam says:

    Your letter sounds good and now comes up as one of googles top searches when gift letter is type. Good Luck!

    Adam

  3. Alessandra says:

    I never thought it would work but I found your sample letter thru google. THANK YOU THANK YOU!!!!!!!!! I was dreading writing this letter and then I found your sample.
    Fingers crossed we get the house!!!!
    We just moved from San Francisco to Jupiter Florida – this makes the ride that much smoother.
    A

  4. Julie says:

    Another happy user of the sample gift letter!

  5. Kirsten says:

    Thanks, I also was lucky to have found your sample! Thanks – I know it will be helpful for many others!

  6. John says:

    will be using this to obtain a “gift” from my bro…since he’s got control of the current finances under his name…looks like i’m halfway through the process…good readin’ here. :p

  7. Tony says:

    This sample is wonderful. My girlfriend has been bugging me to get the letter taken care of and now I can get her off my back.

    Thank you!!!

  8. Jamie says:

    Good example. Thanks for sharing. Wish me luck!

  9. Michele Needle says:

    Great letter! This is exactly what I need. I typed in Gift letter with hopes that Google would find it and thanks to your genorosity, it did! My loose ends are getting tied up. Wish me luck!

  10. Laura says:

    Thank you for sharing…you saved me lots of time.

  11. Nick says:

    Thanks for this letter, it make my life incredibly easy. it took me two munites to complete my gift letter.

  12. Frantic says:

    Thank you so much…. I hope you got your house and I hope we get ours! The letter was perfect! Thanks again. Little Elm, Texas

  13. Adam Alvarez says:

    Just for your information point has a real neat gift letter that you can print and have the donner sign it worked great on my last two loans!! It is a little hard to find but you can e-mail me if you would like help locating the letter. Compliments of Ideal Mortgage Homes & Propertie, Inc and Adam Alvarez

  14. Nina Robinson says:

    What protection do you have from a gift letter. We received a gift for the down payment of our home from my mother in law. She signed a gift letter stating that no repayment was expected. Her other two sons want the money back. Can they do that? Is that legal?

  15. jim says:

    I don’t know if the gift letter will protect you in a situation like that, I’d consult an attorney.

  16. jake says:

    thanks… typed in gift letter then poof!
    you just saved bunch of my time

  17. rc says:

    Thank you for this letter, one of my friend was looking for a gift letter. He will be happy.
    Be blessed

  18. al says:

    Looking for gift letter to meet my son’s house purchase requirements. Was hoping to find something simple. Didn’t expect it to be this simple. Thanks.

  19. Charwhite says:

    Thank you for the gift letter example. I used it for my kids.

  20. g wells says:

    I had to have a statement from the bank showing I had funds in the bank and then another signed statement from the teller showing it after I took out the gift for my sons mortgage down payment. Also a gift letter signed and dated to that affect to him and the abstract company.
    I thought all I had to do was give him a check and a letter of intent.
    no simple thing.

  21. Paul says:

    Spot on temp for gift letter saved loads of time Paul lincolnshire england

  22. Victoria says:

    Thank you . I was searching for the answer and so glad found yours. saved me so much time.

  23. Anonymous says:

    Thanks a lot!!! Since English is not my first language your sample letter was of enormous help.


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