Wedding Gift Registries:
Thinking Outside the Gift Box
A recent post entitled "Crowdfunding your down payment?", written by fellow ActiveRain member, Alan May (Coldwell Banker Residential, Evanston, IL) raised the topic of:
Engaged couples establishing a Wedding Gift Registry for the purpose of raising funds for a downpayment on a future home purchase ...
Now, before you form any opinion on this, consider these wedding/registry statistics I found in 2 recent articles ...
The first stats come from the Pew Research Center article, "How Millennials today compare with their grandparents 50 years ago":
- The average age of grooms in the U.S. is now 29 years. It's 27 years for brides
- The average number of invitees to a wedding: 178
- $19 Billion per year is spent on Wedding Gift Registries
- 91+% of marrying couples register for gifts
- Guests spend an average of $70 to $100 on a gift
A few obvious conclusions can be drawn from the articles and statistics mentioned above:
- Weddings are a big business
- Today's couples are older than their counterparts of even a decade ago
- They (and their guests) are spending more on their weddings
Consider this too: Wedding Gift Registries (reported above at 91% participation) have increased in popularity over the years and are welcomed by both the marrying couple and wedding invitees. The gift suggestions provided via these registries have evolved too. They now reflect the needs and tastes of today's older marrying couples.
As pointed out in Alan May's post, the likelihood of modern wedding couples still needing household gifts (such as small kitchen appliances, towels, etc.) at the time of their wedding is becoming smaller. There are other contributing factors, but the establishment of households by older brides and grooms during the years leading up to the nuptials has certainly reduced or eliminated those needs.
As a result, CASH is now reported by American Express Spending and Saving Tracker to currently be the most popular gift given (33% monetary vs 32% registry) and received (49% of couples prefer monetary gifts vs other gifting).
While Wedding Gift Registries remain popular ... many engaged couples have begun to brainstorm and expand upon the concept. New and different Gift Registry options are now taking shape.
While these many wedding-related changes have been taking place, other new changes and challenges have also been on the rise. Those revolve around home buying.
It's no secret ... saving money for any reason has become increasingly hard over the last decade. That's especially true for down payments.
Recognizing that challenge as it relates to marrying couples, it then becomes much easier to understand the growing popularity of wedding registries established for this unique gift giving purpose ... a home's down payment.
But consider a couple using the following math equation with the statistics found above:
Average number of wedding guests (178)
Amount of average monetary gift ($70 - $100)
The answer reveals a healthy down payment ... or savings to place toward a home's Closing Costs ... being gifted.
Feel differently about the wisdom of putting this type of Wedding Gift Registry to work on your behalf now?
Does it change your initial reaction? Could you suggest it to clients?
For those marrying couples saying "YES" ... and considering the establishment of this unique gift request, please take note:
Documentation and handling of gift monies received is vitally important. Mortgage Underwriting rules regarding the receipt of monetary gifts are strict and need to be adhered to closely.
"Verifiable" funds ... and a corresponding paper trail into account(s) established for down payment purposes will be required. That means every check received and placed into an account(s) towards down payment (or Closing Costs) must be copied, then provided to the Lender.
Marrying couples utilizing this type of Gift Registry must keep in mind: Underwriters will need to know WHERE the monies used for their Down Payment and Closing Costs come from. They'll want to know the "source" of all funds received. Couples need to establish simple bookkeeping steps prior to the first receipt of gift monies.
It must also be pointed out to couples utilizing this type of Gift Registry: An Underwriter may request a copy of your Wedding Invitation. If formal invitations were not issued, an engagement notice or copy of the Marriage License will typically suffice.
This particular request sometimes takes my newly-married couples by surprise, so I mention it here to remove any surprise element in the future.
With all the above-mentioned needs in mind for documentation and verification, you can see why I strongly suggest that couples contemplating the establishment of a Gift Registry for down payment purposes meet with me prior to Registry set-up.
It just makes sense to seek and gain the correct advice and instructions to record gifts properly prior to their initial receipt than it is to backtrack and try to correct the documentation later. And it definitely saves time and avoids frustrations during an already stressful time ...
* Hoping to Buy or Refinance a home in New Lenox, Will County, or elsewhere in the Chicagoland area? Contact me! I'll put my 40+ years of Mortgage experience and expertise hard to work on your behalf.
I can be easily found at:
Mortgage Originator - NMLS #216987 - IL Lic. #031.0006220 - WI Licensed
American Portfolio Mortgage Corp.