Waianae, HI · Member since 2016 · 111 posts · 47 votes
9y
Here are some information for 2017 for FHA loan rules website:
That money is required to be verified by the lender as having come from an approved source. What is an approved source? The borrower can tap into his or her own cash reserves, cash-in investments, savings bonds or other holdings. The idea behind verifying the source of your down payment on an FHA mortgage is to prevent borrowers from provided money obtained from non-collateralized loans such as a credit card cash advance, payday loans, etc.
Then there's scrutiny of the gift giver. According to Chapter Five, An outright gift of the cash investment is acceptable if the donor is
-the borrower's relative
-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.
The FHA doesn't just list who may give such a gift--it also has rules discussing who MAY NOT provide gift funds for an FHA loan down payment. The gift donor may not be a person or entity with an interest in the sale of the property, such as
the seller
the real estate agent or broker
the builder
an associated entity
Gifts from these sources are considered inducements to purchase, and must be subtracted from the sales price.
You can get more information by just typing out FHA Loan Rules for 2017 and the link should come up on your browser.
Philadelphia, PA · Member since 2016 · 13 posts · 1 vote
9y
My friend would like to live with me if I purchased a house and is willing to pay his rent upfront to help cover any downpayment or closing costs. Would a lender allow this?
Hampton, VA · Member since 2016 · 20 posts · 7 votes
9y
I suggest drawing up a lease between you and your friend.
It's really easy and having documentation for you rental income won't make anyone LESS likely to lend to you.
Just make sure your lease specifies what is being leased because if it could be misunderstood as renting the entire home, that could work against the FHA guidelines.
You are allowed to rent with an FHA loan, but not invest, so you just have to make sure your lease doesn't look like you won't be an occupant.