Down payment gift rules for USDA mortgages

November 06, 2020 by Dan Green

USDA loans are loans backed by the U.S. Department of Agriculture. USDA loans are similar to VA loans in that the program doesn’t require a down payment.

As a home buyer, though, you’re welcome to make a down payment if you want to; and, that down payment can come from a cash gift.

The USDA doesn’t require home buyers to have their own money in a home-buying transaction. Buyers using the USDA mortgage program can use their down payment gift for the entirety of what they put down.

When you need a cash gift down payment letter, whether you’re the gift giver or gift receiver, you have a few options:

  1. Write your own letter and give it to the lender
  2. Hire an attorney to write your letter for the lender
  3. Download a pre-written mortgage gift letter and fill-in-the-blanks

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