@Anonymous wrote:
Why do you suppose they ask for
4. If the gift funds are to be provided at closing, and are in the form of a cashier’s check, money order, official check, or other type of bank check, then have the donor provide a withdrawal document or cancelled check for the amount of the gift, showing that the funds came from the donor’s personal account
The key being the donor's personal account.
You can't gift money that you do not have.
Only if it is a Home Equity Line of Credit and is secured it is ok.
I guess we'll just agree to disagree. I've been doing loans like that for years. It is a very obscure guideline, but is perfectly fine.
Again, you are mixing up guidelines on where borrowers can borrow money from vs. where donors can get money from.
If you read #6 in the above, it says:
6. If the gift funds are being borrowed by the donor, and documentation from the bank or other savings account is not available, then have the donor provide written evidence that the funds were borrowed from an acceptable source, not from a party to the transaction, including the lender (cash on hand is not an acceptable source of donor gift funds).
The only restriction on where a donor cannot get borrowed funds from on an FHA mortgage are: cash & from a party to the transaction (i.e. the seller gives the donor money, who gifts it to the borrower). It doesn't say the borrowed funds by the donor must be a HELOC or other secured funds.
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