Did You know that lenders have certain restrictions on property types when doing a Gift of Equity transaction?
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- 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.
If you have questions about how the Gift of Equity works, contact our office, and we’ll connect you with a loan consultant that can explain how the transaction works.
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