How to Notarize a Mortgage Gift Letter
Lenders require a notarized gift letter to prove that down payment funds are a gift, not a loan. Get yours notarized online in 15 minutes.
Using gift funds for your home purchase? Get your gift letter notarized online to satisfy your lender's requirements.
Get Notarized Online — 15 MinutesRemote Online Notarization. Video-based. Legally valid in all 50 states.
At a glance
- Notarization required: Yes
- Witnesses required: No (most states)
What is a Mortgage Gift Letter?
When you use money from a family member or friend for your home's down payment, lenders want to ensure that the money is a gift and not a hidden loan that you will have to pay back. A gift letter provides this assurance.
Why Lenders Require Notarization
Lenders are highly sensitive to "unstructured debt." If the money is actually a loan, it changes your debt-to-income ratio and may disqualify you from the mortgage. A notarized statement, made under penalty of perjury, provides the legal weight the lender needs to verify the source of funds.
Essential Components of the Letter
To satisfy underwriting requirements, the letter should include:
- The Gift Amount: The exact dollar amount.
- The Relationship: donor's relationship to the borrower (parent, sibling, etc.).
- Repayment Clause: A specific statement that "No repayment is expected or implied."
- Source of Funds: donor's address and account information (sometimes required).
- Property Address: The address of the home you are buying.
Online Notarization Process
The donor can simply upload the letter to a RON platform, verify their identity, and meet with a notary over video. The process takes about 15 minutes, and the donor receives a digitally sealed PDF to send to the buyer or the loan officer.
Frequently Asked Questions
- Does every gift letter need to be notarized?
- Not all. Whether a gift letter needs to be notarized depends on your specific lender's requirements and the type of loan (FHA, VA, or Conventional). However, many lenders require notarization to prevent mortgage fraud.
- What must the gift letter state?
- The letter must state: the donor's name and relationship to the buyer, the exact gift amount, the address of the property being purchased, and a clear statement that no repayment is expected or required.
- Who signs the mortgage gift letter?
- The donor (the person giving the money) must sign the letter. In most cases, the buyer also signs. If notarization is required, the donor's signature is the one that must be notarized.
- Can I use an online notary for a gift letter?
- Yes. Remote Online Notarization is accepted by most major mortgage lenders. It is particularly convenient when the donor lives in a different state than the buyer.
- When should the gift letter be notarized?
- You should notarize the letter as soon as the funds are transferred or as requested by your mortgage loan officer during the underwriting process.
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