Yes, family can gift you the down payment, and on most first-time purchases in Florida the whole down payment can come from a parent, grandparent or other relative. Every major program allows gifts: FHA, Conventional, VA and USDA. What the lender needs is paperwork. A signed gift letter states that the money is a gift and doesn't have to be paid back, and bank records show the money moving from the giver to you or to the closing agent.
Who can give you the money
| Program | Acceptable donors |
|---|---|
| FHA | A family member, your employer or labor union, a close friend with a clearly documented interest in you, a charitable organization, or a government agency with a homebuyer program |
| Conventional (Fannie Mae) | Relatives by blood, marriage, adoption or guardianship, a domestic partner, a fiancé or fiancée, a former relative, or someone with a long-standing family-like or mentoring relationship |
| VA and USDA | Documented gifts are accepted toward the down payment and closing costs |
The builder, the real estate agents and anyone else with a financial stake in the sale can't be the donor. A seller can still help with closing costs through a seller credit, which has its own limits, and a relative selling you their own home can help through a gift of equity, covered below.
How much of it can be a gift
FHA: All of it. The 3.5% down at a 580 score, or the 10% down from 500 to 579, can come entirely from an acceptable donor, along with closing costs and prepaids.
Conventional, single-family home you'll live in: All of it, with no minimum from your own pocket.
Conventional, 2 to 4 units, more than 80% loan-to-value: You put in at least 5% from your own funds first, and gifts can cover the rest. One exception helps a lot of families: a gift from a relative or partner who has lived with you for the last 12 months and will live in the new home too counts as your own funds.
The gift letter and the paper trail
Fannie Mae's gift letter has to be signed by the donor and show the dollar amount, the donor's name, address, phone number and relationship to you, and a statement that no repayment is expected. FHA asks for the same core details. Then the lender documents the transfer with one of these:
- The donor's check and your deposit slip
- The donor's withdrawal slip and your deposit slip
- An electronic transfer to your account or to the closing agent
- The donor's check or wire straight to the closing agent
If the gift goes straight to closing, it has to arrive by wire or other electronic transfer, certified check, cashier's check or another official check.
A worked example
Ana is buying a $320,000 single-family home with FHA at a 5.75% rate. Property tax runs 0.95% a year, and insurance is $283 a month.
| Item | Amount |
|---|---|
| Down payment (3.5%) | $11,200.00 |
| Closing costs and prepaids | $12,992.93 |
| Total before help | $24,192.93 |
| Gift from her parents | minus $11,200.00 |
| Seller credit (3% of the price) | minus $9,600.00 |
| Ana brings | $3,392.93 |
The closing costs include $5,800 in lender, appraisal, title and settlement fees, $1,100.05 in Florida doc stamps on the $314,204 loan, $628.41 in intangible tax, a year of insurance ($3,396), a $1,326 opening escrow deposit and $742.47 of prepaid interest. Her parents wire the $11,200 to the title company with a signed gift letter, and her earnest money deposit counts toward her $3,392.93.
On Conventional with 3% down, the same home needs $9,600 down, and all of it can be the gift. On a $400,000 Conventional duplex with 5% down, Ana would need $20,000 of her own money first.
Other ways family can help
- Co-sign instead of, or as well as, giving. A parent who co-signs adds their income on FHA and Conventional, which raises the price you qualify for.
- Give equity. When a relative sells you their home below its value, FHA and Fannie Mae let that equity count as a gift toward the down payment.
- Pair a smaller gift with FHA 100% financing. The down payment assistance second covers the 3.5%, so a family gift only has to cover closing costs.
To see how far a gift goes, enter it with your price and seller credit in the cash to close calculator. Before anyone moves money, call AAA Capital Funding at 888-601-8344. We'll tell your family exactly how to send it so the lender can document it the first time.