How to write a gift letter
Below is a template for a gift letter, useful when family or friends want to help you with a loan downpayment.
Funds verification
Remember, the source of funds, even gifted funds, will need to be verified by the underwriter. This ensures that the funds are not borrowed (for example form a credit card). Some borrowed funds are acceptable for SBA loans, such as a HELOC. If you are literally dealing with cash that was stuffed under your mattress, it’s advisable you deposit in a bank account first and “season” the money for 90 days. Click here for SOP lender guidelines on equity verification Gift Letter PDF Download
GIFT LETTER
Applicant:
TO WHOM IT MAY CONCERN;
I, ________________________(donor’s name) of _______________________ (donor’s address)
do hereby certify that I have given a gift of $___________________ to
__________________________(recipient’s name)
who is my ___________________________(relationship), to be applied toward the purchase of the business
located at . _______________________(property address)
I further certify that there is no repayment expected or implied for this gift in the form of cash or future services from the recipient (or any of them, if more than one). I understand that Lender is relying upon the information in this Gift Letter in deciding whether to extend credit to the above mentioned recipient(s).
Signed:
__________________________(donor’s signature)
Date:__________________________
__________________________(donor’s phone number)
Signed:
__________________________(borrower)
Date: __________________________
__________________________(borrower)
STATE OF __________________________
COUNTY OF __________________________
On this _____day of __________________________ , 20____ , before me, a Notary Public for this County, personally appeared __________________________ who I know to be the persons described in the foregoing instrument, and who acknowledged that they executed this instrument as his free act and deed.
Notary Public__________________________
STATE OF __________________________
COUNTY OF __________________________
On this _____day of __________________________ , 20____ , before me, a Notary Public for this County, personally appeared __________________________ who I know to be the persons described in the foregoing instrument, and who acknowledged that they executed this instrument as his free act and deed.
Notary Public__________________________
Note to Lender: If the donor has not yet given gift to recipient, provide verification that the donor has sufficient funds to do so. If recipient has received funds, verify the transfer of funds from the donor’s account to the recipient’s account.
Gift letters are acceptable in many financial situations such as Business loans, Home Purchases or other loans that require some financial help from friends or family.