Home Buyers Register For Down Payment?

Home Buyers Register For Down Payment?

The typical bridal registry is filled with china, glassware, toasters and towels. However today's couples are opting for non-traditional registries that can help with a down payment on a home. These alternative registries can be used for paying off debt or wedding expenses, but also to put cash down on a home. Many couples are already living together and getting married at an older age, traditional gifts just are not needed.

In 1996 the FHA (Federal Housing Administration) started an initiative to allow friends and family members to deposit money into an account for the purpose of buying a home. This initiative ended in 2000, but FHA still allows gifts to be used as down payments. This money does have to be documented as a gift and cannot be from any participant of the sale (ex: the real estate agent or builder). Although if a married couple does not immediately use the money (wait some months) for a down payment, then it would not need to be documented as a gift. I would advise checking with your mortgage professional before setting up this type of registry to ensure that you meet any specific criteria.

According to the 2010 National Association of Realtors Profile of Home Buyers and Sellers , 27% of first time home buyers used gift money from relatives and friends to make their down payment. This is a great way for newly married couples to start out towards home ownership!