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Established Member
jjmtmj126
Posts: 58
Registered: ‎03-13-2012
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Cash (not check) downpayment gift

So my dad is going to give us a gift for our downpayment of $3,000, but he's "old school" and wants to just give us cash.  Right now he gets paid cash from his job, and he has set aside $3,000 for us (literally, 30 $100 bills in an envelope for us).  He doesn't want to deposit the cash and give us a check.  So, what options do we have?  I know we have to have a paper trail.  Can he take the cash and get a money order or cashiers check or something?  Or the other option I thought of was giving the cash to someone else to deposit, and then getting a check from them.  

 

Any ideas?

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germaine47
Posts: 305
Registered: ‎07-05-2011
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Re: Cash (not check) downpayment gift

Good Morning,

 

I am in UW and they are very stringent about cash gifts.  Any unexplained check or cash depsit has to have an money trail and it has to sit in the bank for at least one month.

For example my exhusband is contributing $3000.00 to my closing cost, my MB stated that he have to give bank statements to show that he had the money to give from his accounts and I had to write a letter of explanation as to why he is giving me this money and that it is a gift.  Now mind you my ex-husband told me that he isnt giving any one his bank statement.  Thank God that I am getting a USDA Loan and I dont have to pay a down payment and the Sellers are paying for most of my cosing cost so the only out of pocket money that I am out of right now is the Earnest Money Check in which was factored in with the closing cost.  Talk with your MB as to how to handle this.

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Regular Contributor
To-Be-Continued
Posts: 197
Registered: ‎06-08-2011
0

Re: Cash (not check) downpayment gift

They are very strict about a money trail. They need proof that the money is clean, because if the money is from nefarious means (dirty money) they can lose their collateral ( cops seize the house) to forfeiture due to illegal activity.

 

 

TBC

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Senior Contributor
Booner72
Posts: 3,889
Registered: ‎05-24-2011
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Re: Cash (not check) downpayment gift

Hopefully dad will change his mind....cuz an evelope o' cash ain't gonna cut it.  That could be drug money, tax evased money, etc.  (Not saying your dad, just saying that is what they could think).  I read another post here where they wanted a printout of dad's bank account showing the money came out of there.

 

Good Luck!

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webhopper
Posts: 7,230
Registered: ‎09-16-2011
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Re: Cash (not check) downpayment gift


jjmtmj126 wrote:

So my dad is going to give us a gift for our downpayment of $3,000, but he's "old school" and wants to just give us cash.  Right now he gets paid cash from his job, and he has set aside $3,000 for us (literally, 30 $100 bills in an envelope for us).  He doesn't want to deposit the cash and give us a check.  So, what options do we have?  I know we have to have a paper trail.  Can he take the cash and get a money order or cashiers check or something?  Or the other option I thought of was giving the cash to someone else to deposit, and then getting a check from them.  

 

Any ideas?


He needs to deposit that cash and give you a cashiers check... Also they are going to want a paper trail from his bank account to make sure the money is legit.   They do this to combat money laundering


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Established Member
jjmtmj126
Posts: 58
Registered: ‎03-13-2012
0

Re: Cash (not check) downpayment gift

Thanks Guys.  I met with my dad this past weekend, and with a lot of persuasion I got him to just get me a cashiers check from the bank.  whew... One hurdle down, many more to go!  We are in underwriting, so now we wait!

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cassembler
Posts: 470
Registered: ‎02-07-2011
0

Re: Cash (not check) downpayment gift

I know I'm late to this party, but another option would be to (literally) pocket the $3k and use it for general home stuff after closing (furniture, appliances, painting, etc).

 

Regardless, hope everything works out well.

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Contributor
seemund
Posts: 90
Registered: ‎03-29-2010
0

Re: Cash (not check) downpayment gift

Just like everybody already mentioned, they will want to see where the money came from.

A large deposit will be a BIG RED FLAG.

 

Few other options:

1- Deposit the money, wait 2 months before applying for mortgage? (so you don't have to show proof of where it came from)

2- Pay everything you can with the $3000 (utilities, gas, food, furniture, etc), saving more money in the bank?

 

Good Luck!

 

 


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