A down-payment gift from family is one of the most common ways Florida buyers get into a home — and one of the easiest ways to accidentally delay a closing if the paperwork isn’t handled right. Here’s exactly how to do it cleanly.
Key Takeaways
- On a primary residence, 100% of your down payment can often be a gift.
- The gift must come from an eligible donor (usually family) and be truly a gift — not a loan.
- You’ll need a signed gift letter and a clear paper trail of the transfer.
- How the money moves matters — document every step to avoid delays.
- Rules differ for second homes and investment properties.
Who Can Give a Gift
For most loans, gift funds must come from a family member — parents, grandparents, siblings, spouse, or sometimes a domestic partner or fiancé(e). FHA is broadest and can also allow gifts from an employer, close friend with a clear interest, or an approved down-payment-assistance program. The donor must confirm the money is a gift with no expectation of repayment.
How Much Can Be Gifted
On a primary residence, the entire down payment and closing costs can typically be gifted (on FHA and most conventional programs). On a second home, gifts are usually allowed but some programs want a small portion from your own funds. On an investment property, gift funds are generally not permitted.
The recipient owes no income tax on a gift. Large gifts may involve the donor filing a gift-tax return, but the annual exclusion is generous and most family down-payment gifts are well within lifetime limits. Confirm with a tax pro.
The Paperwork: Gift Letter + Paper Trail
Two things make a gift underwriting-ready:
- A signed gift letter stating the amount, the donor, the relationship, the property, and that no repayment is expected.
- A paper trail: the donor’s statement showing the funds, the withdrawal, and your matching deposit — or a wire/cashier’s check with documentation.
We provide the exact gift-letter template so it’s right the first time.
The Mistakes That Delay Closings
Don’t deposit gift cash you can’t source. Don’t let the donor pay a vendor directly without documentation. Don’t co-mingle the gift with other large unexplained deposits. Each of these triggers underwriter questions that stall your file.
The fix is simple: move the money once, cleanly, with a clear record, and hand us the statements. A well-documented gift is a non-event; a messy one can cost you your closing date.
Florida-Specific Notes
With Florida’s higher insurance and closing costs, many families gift enough to cover both the down payment and closing costs. That’s allowed on a primary residence — just document the full amount the same way.
Getting a down-payment gift from family? We’ll make sure it’s documented right so it never slows your closing.
Get Pre-Approved →Frequently Asked Questions
Can my entire down payment be a gift?
On a primary residence, yes — most conventional and FHA programs allow 100% of the down payment (and often closing costs) to come from an eligible gift. Second homes and investment properties have stricter rules.
Who is allowed to give me down payment gift funds?
Generally a family member — parents, grandparents, siblings, spouse, or fiancé(e). FHA is broader and may allow gifts from employers, close friends with a documented interest, or approved assistance programs.
What is a gift letter?
A signed statement from the donor confirming the gift amount, the relationship, the property, and that no repayment is expected. Lenders require it, and we provide a ready-to-use template.
Do I have to pay taxes on gift funds?
The person receiving the gift owes no income tax. The donor may need to file a gift-tax return for large amounts, but most family down-payment gifts fall within generous limits. Check with a tax professional.
What’s the most common gift-fund mistake?
Poor documentation — unsourced cash deposits, the donor paying a vendor directly without a trail, or co-mingling funds. Move the money once, cleanly, with statements, and it’s a non-issue.
Turn a Family Gift Into a Home
We’ll hand you the exact gift-letter template and walk you through the paper trail so your down-payment gift sails through underwriting.