Gift Funds to Help with Homeownership

Last week, I met with a client starting the home-buying process. She was offered a generous gift from her godmother to supplement her funds for a down payment. Until recently, I would have had to say that a godmother is not an acceptable donor, but fortunately, Fannie Mae recently expanded the list of acceptable donors to include non-relatives that share a familial relationship with the borrower. As a result, godparents are now included.

Acceptable Donors for Gift Funds

There are three categories of acceptable donors:

• Relatives: borrower’s spouse, child, or any individual related to the borrower by blood, marriage, or adoption
• Unmarried Partner: domestic partner or fiancé
• Unrelated Friend (new): former relative of the borrower, relative of borrower’s domestic partner, or godparent of the borrower

As a result, this updated list will help many more clients attain homeownership.

If you have any questions or are interested in discussing your mortgage needs, please contact us.