Using Stock Funds for Down Payment

Many times, one will wait until the last minute (right before closing) to cash in stock options for closing funds.  This can be dangerous.  If for some reason the stock crashes between the time your offer is accepted and the planned date to sell the shares, you might be out of luck for a down payment.  Keep this in mind, it might be a better idea to just bite the bullet, cash them in and have the funds available before you write an offer.  As with gift funds, if the money is not in your account and liquid at the time your offer is presented, you are required to disclose to the seller that the down payment is coming from the sale of stock.  In a competitive market, this will make your offer less attractive so it is best to have the funds available at the time you present the offer.

Gift Funds For Down Payment

If you are receiving down payment funds in the form of a gift, your lender will provide you the Gift Letter and you will have to complete and sign them (signed by the person providing the gift as well as you, the borrower).  They will also need a copy of the ACTUAL GIFT CHECK, and proof of the deposit to your bank account.  Once funds are credited to your bank account, you will need to provide a transaction history from the date of your last bank statement through the date of the deposited gift funds showing the available balance as well as well as copies of all documents used to provide the funds (a copy of the check, front and back after deposited and cancelled.  If the money is being wired, you will need a copy of the outgoing wire, the confirmation of receipt of the incoming wire and a current statement showing the available funds in the receiving account).