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100% Gift Funds Allowed on Conventional Home Purchase

If you are thinking of buying a home but have not saved up enough for your down payment there are options available. Conventional loans, such as Fannie Mae, allow for 100% gift funds from a qualified donor when purchasing a home. Most banks may tell you that the use of gift funds for a low down payment purchase is limited to an FHA loan. With the changes in FHA financing over the past several years they have become one of the most expensive mortgage loans available for residential homebuyers.

At a Glance:

Conventional NO upfront Mortgage insurance

  • FHA has up front Mortgage Insurance of 1.75% of the loan amount on all Loans

Conventional loans allow for the removal of mortgage insurance at 78% of original value

  • FHA mortgage insurance lasts for the life of the loan with less than a 10% down payment

Mortgage insurance on conventional loans costs less with better credit scores

  • FHA mortgage insurance cost the same for all credit scores

Conventional loans offer the best financing option in most cases and the allowance of gift funds will assist in making homeownership more affordable. More information is available by contacting Brent Diebert at: or by phone at 614-571-3554

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