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can we use a sellers gift for down payment?
We are looking at making a purchase on a home- because of our credit and terms- we need 35% downpayment. We have to get the loan for at least 21,600- even though they are only asking 15,000 for it. We want to buy it, before we could come up with 35% (6600) for the downpayment. Could we get the loan for 21,600- and have the seller 'gift' the 6600- so our mortgage would really only be the 15000 which is the minimum the finance company will loan to us?
How does that work?
p.s. the home value is over $34,000
yes it's a trailer- and the only reason we are trying to do it now- is because the house we are in (relatives) is being forclosed on and we need to be out sooner than we thought (we have been working to clean our credit scores up to get a house). We don't have the entire 35% down. We don't want to do anything fraudulent- that is not our intention at all. I just have no idea how this stuff works, and was asking because we were trying to come up with ways because this is a really good deal on this house and the owner is ExTREMEMly motivated to sell.
Thank you- we do have half the downpayment saved- we are just short the other half (we werent expecting it to be such a high fee).
4 Answers
- Anonymous10 years ago
Absolutely NOT. What you suggest borders on fraud and I wonder that you are even trying this right now with credit issues that entail you needing 35% down. Also shocked you could get a mortgage for such a small amount of money it is usually not worth the paperwork and banks/financial institutions will not do them.
Is this a trailer?
- Anonymous10 years ago
The government squashed these gifts a few years ago.
They amount to fraud.
1. Down payments are there for a reason, to ensure you have some of your own money in the game. if the seller were to gift it to you, it's the seller's money not yours.
2. If the house is selling for $15,000 (that's what it's worth), then saying it's selling for $21,600 is a lie.
- Lisa LLv 610 years ago
Not on a conforming mortgage it but sounds like you are not getting a conforming mortgage. Ask the finance company but I would doubt it.
- acermillLv 710 years ago
You can only do so if you inform the mortgage lender of this arrangement, and if the mortgage lender approves such. Chances of approval of this type of arrangement are close to ZERO.