can somebody tell me how much money one can receive as a gift ( to use for home purchasing) from a relative that is tax free.?

Asked by Kate Everett, 32701 Wed Mar 30, 2011

Is there a limit ?

Help the community by answering this question:

+ web reference
Web reference:


Rudy McDowell, Mortgage Broker Or Lender, Bloomfield Hills, MI
Wed Mar 30, 2011
Hi, Kate. For a Conventional/Fannie Mae loan, you can typically recive up to 5% of the total sale price as a gift. However, you must have a min of 5% of your own money vested as well. For FHA and VA, there are no limits, and even your 3.5% min down payment can be gifted. With regards to the tax free portion, that's a question best answered by you and your relatives accountant(s).
0 votes
Ron & Susan…, Agent, Lafayette, CA
Wed Mar 30, 2011
I believe there are really two elements to this question... one is what the IRS will allow as a tax free gift, and two.. what the lender will allow for the home purchase. The IRS will allow $13,000 per annum to be given from one person to another on a tax free basis. So, if parents hypothetically were giving to their son and daughter-in-law, each parent could separately gift to the son/daughter-in-law. Each would ultimately receive $26,000, or a total of $52,000 tax free to the couple. All tax advice should be verified by your CPA or other tax professional.

Each lender has different guidelines for parental gifts, when they can be given, how much can be applied to the down payment, etc.
0 votes
Rob Arnold, Agent, Altamonte Springs, FL
Wed Mar 30, 2011
as long as it is a gift and does not have to be paid back, with almost all lenders could go up to %20 of the purchase price,
I hope that answered your question,
0 votes
Kate Everett, Home Buyer, 32701
Wed Mar 30, 2011
thank you for your answers. So, from what I can understand the receiver doesnt have to pay taxes regardless of the amount, but the giver has 13000 tax exempt?
0 votes
Jose Morales, Mortgage Broker Or Lender, Lutz, FL
Wed Mar 30, 2011
You have to deal with two issues here. The first is related to the IRS. You can receive a gift of up to $13K without paying taxes(,,id=108139,00.html).

The second is related to how much would a lender allow you to receive as a gift to buy a property. On FHA loans there is no limit per se but lenders may have their own restrictions particularly if your credit is marginal. In general with good scores, lenders don't limit it. On conventional loans, if you are putting 20% down there is typically no limit for using the gift entirely as a down payment. If you are putting less than 20% down, you may have to show that a certain percentage of the down payment(typically 5%) came from your own funds. Call or email me if you have further questions.

Jose Morales
Florida Mortgage Coach
“We Coach You Through the Mortgage Process”
0 votes
BG, Home Buyer, Phoenix, AZ
Wed Mar 30, 2011
yes, check with your state and IRS guideline ... I heard some thing like 10K per person .. regardless of the usage of the money.
0 votes
Search Advice
Ask our community a question

Email me when…

Learn more