Generate a professional gift letter for mortgage down payments, closing costs, and large gifts. Document the source of funds, confirm no repayment is expected, and satisfy lender requirements with a comprehensive gift letter.
I built this gift letter generator to help home buyers and their families document gift funds properly for mortgage applications. Mortgage lenders universally require a gift letter whenever any portion of the down payment or closing costs comes from a third party rather than the borrower's own savings. Without a proper gift letter, lenders may delay or deny a loan application, treating the gifted funds as an undisclosed loan that increases the borrower's debt-to-income ratio.
This generator produces a comprehensive gift letter that satisfies the requirements of FHA, VA, USDA, and conventional mortgage lenders. The document includes all essential elements: a formal gift declaration identifying the donor and their relationship to the recipient, detailed gift information including amount and method of transfer, property information for mortgage-related gifts, source of funds documentation, and a complete set of certifications confirming the gift is bona fide with no expectation of repayment.
Every field updates the live preview instantly, so you can see exactly how your letter will look before downloading. The generator also includes optional sections for lender information, notary acknowledgment, and tax-related disclosures. Whether you are giving a gift for a home purchase, education, wedding, or any other purpose, this tool generates a professional document that protects both the donor and recipient.
Key features include: conditional property information sections that appear only for mortgage-related gifts, source of funds documentation with bank information, IRS gift tax exclusion acknowledgment, ten comprehensive certifications covering all lender requirements, and dual signature blocks for both donor and recipient.
Yes, most mortgage lenders require a gift letter whenever any portion of the down payment or closing costs comes from a gift rather than the borrower's own funds. FHA, VA, USDA, and conventional loans all have specific gift letter requirements. The letter must confirm that the funds are a genuine gift with no expectation of repayment.
The IRS annual gift tax exclusion allows an individual to give up to a certain amount per recipient per year without triggering gift tax reporting requirements. For 2024, the annual exclusion is $18,000 per recipient ($36,000 for married couples giving jointly). Gifts exceeding this amount require the donor to file IRS Form 709.
Yes, gift letters can be used for any significant monetary gift, not just mortgage-related gifts. Common non-mortgage uses include gifts for education expenses, wedding gifts, medical expense assistance, business startup funding, and general financial assistance.
Most mortgage lenders do not require gift letters to be notarized, though some lenders may request notarization as an additional verification step. Notarization adds an extra layer of authenticity and can strengthen the letter's validity.
In addition to the signed gift letter, most lenders require bank statements from the donor showing the source and withdrawal of funds, bank statements from the recipient showing the deposit, a copy of the check or wire transfer confirmation, and documentation of the donor's relationship to the recipient.
Acceptable gift donors vary by loan type. For conventional loans, gifts can come from a relative, domestic partner, fiance, or an entity such as an employer or nonprofit. For FHA loans, gifts can come from family members, close friends, employers, labor unions, charitable organizations, or government agencies. Gifts from the seller, real estate agent, or other interested parties to the transaction are generally not permitted.