Did You know that lenders have certain restrictions on property types when doing a Gift of Equity transaction?
- Some of our wholesale lenders will allow a gift of equity on a primary 1-2 unit property ONLY.
- 3-4 units ARE NOT ALLOWED.
- Second homes REQUIRE a minimum of 5% of the Borrower’s own funds when the LTV is over 80%.
A gift of equity is when a property is being sold between immediate family members. There is no money exchanging hands; it’s the equity that is being used for down payment and closing costs.