Answers by Tolga Tony Erzene

Yes, you can absolutely use family gift funds toward your down payment, but the lender requires a clear paper trail: the money must come from an immediate family member, be accompanied by a signed gift letter stating it’s not a loan, and be transferred by check, wire, or direct deposit (never cash) with documentation showing the donor’s withdrawal and your deposit; ideally the funds are deposited at least 60 days before closing so they appear “seasoned,” though many lenders also allow the gift to be wired directly to the title company at closing, so the best way is to have your family transfer the funds in a traceable manner, complete the lender’s gift letter, and provide all proof of transfer to keep everything clean and approved.