FHA & gofundme gift money for down payment

[flinjami83]

Can anyone tell me if they have been allowed to use gift money through the gofundme website to be used as part of their down payment for FHA loans? 
There are tons of people who have gofundme accounts set up to help them with FHA down payments. Since it is gift money and not loan money I don't see why it cannot be used. But my broker is telling me we cannot use it. If that's true then why do so many others have funds set up for it? She can be a little coo-coo sometimes so I'm just wondering if she's right, this is the first time she's ever had anyone ask her about this & had never heard of gofundme. Anyone???

[CreditHealthy]

LOL!! "A little coo coo!!!...hahahaha! I don't have a clue but good question, I was wondering about FHA guidlines were for gift downpayments as well.

[ezdriver]

Not enough information on which to render an opinion. Is the homebuyer assistance program apporved by the FHA? If yes, then you're good. If not, then there's your answer.

[ShanetheMortgageMan]

FYI, GoFundMe is a crowdfunding/fundraising website.  The short answer is "most likely not".

Gifts can be provided by:

• the borrower’s employer or labor union
• a close friend with a clearly defined and documented interest in the borrower
• a charitable organization
• a governmental agency or public entity that has a program providing home ownership assistance to low- and moderate-income families, or first-time homebuyers.

Regardless of when gift funds are made available to a borrower, the lender must be able to determine that the gift funds were not provided by an unacceptable source, and were the donor’s own funds.  As a general rule, FHA is not concerned with how a donor obtains gift funds, provided that the funds are not derived in any manner from a party to the sales transaction.  Donors may borrow gift funds from any other acceptable source, provided the mortgage borrowers are not obligors to any note to secure money borrowed to give the gift.  The lender must document any gift funds through a gift letter, signed by the donor and borrower. The gift letter must show the donor’s name, address, telephone number specify the dollar amount of the gift, and state the nature of the donor’s relationship to the borrower, and that no repayment is required.

Since crowfunding is usually done people who may or may not be anonymous, it can be impossible to tell who is actually giving the gift.

I suspect the people who use crowfunding websites to raise down payments are just depositing the funds in their account early enough that the bank statements showing the deposit aren't being provided to the underwriter due to them being over 60 days old.

[ezdriver]

Thank you for that info Shane. I knew about crowdfunding but I never knew that folks were using that method to raise funds for downpayment on home purchases.

I've been thinking of buying a Jeep Wrangler Unlimited Sahara. Crowdfunding here I come!

[Laura1369]

So I read this and had to go check out gofundme. I have two relatives currently using it to raise money for their piss poor financial decisions so I knew a little about it. I wanted to see what other people are funding! Everything from mission trips to Haiti, to vet care, to home and car down payments! So I am wondering how many suckers I can get to pay for the fence I want to install at my new home for my dogs. Oh and to buy the liquor to stock the bar we are building in the basement?