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Lender Alerts

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Gift Funds on FHA Loans

Dear Licensed Partner,

Sun West would like to remind our valued partners about FHA requirements in regards to gifts as an acceptable source of funds and its required documentation on FHA loans. When gift funds are used towards cash to close, the following required documents must be submitted to Sun West as explained in the HUD Handbook 4155.1:

Gift Letter Requirement

  • Gift letter must show the donor’s name, address, telephone number.
  • Specify the dollar amount of the gift and that no repayment is required.
  • State the nature of the donor’s relationship to the borrower.

Please click here for a copy of the gift letter that is accepted. 

Gift Fund Required Documentation

When gift funds are already deposited in borrower’s account:

  • A copy of the withdrawal* document showing that funds were withdrawn from the donor’s account.
  • A copy of borrower’s deposit slip and bank statement showing the deposit.
When gifts funds are to be provided to escrow initial / closing:
  • A copy of the withdrawal* document showing that funds were withdrawn from the donor’s account.
  • Escrow receipt / Final HUD as applicable showing gift funds provided.

*Withdrawal document must include one of the following:

  • Using personal check: Front and back copy of cancelled check showing the account information and donor’s name.
  • Using cashier’s check/money order/certified check: Donor’s bank statement showing withdrawal from donor’s account and copy of check will be required if funds were transferred using cashier’s check, money order, certified check or any other type of bank check. Any large deposit in donor’s account must be sourced.
  • Using wire transfer: copy of wire transfer document, if funds are transferred using electronic wire transfer.
Note: Cash on hand is not acceptable source of gift funds for all transactions.

If you have any questions, please contact your Client Relations Manager at (855) OK-SUNWEST or (855) 657-8693.


Sun West Mortgage Company, Inc.
18000 Studebaker Road, Suite 200
Cerritos, CA 90703
Phone: (800) 453-7884
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Equal Housing Opportunity This information is provided to licensed brokers/lenders only and may not be copied or distributed to customers or potential customers. All loans are subject to approval. Certain restrictions may apply. Listed pricing is a morning indication only. Program rates, prices, guidelines, fees, costs, terms and conditions are subject to change without notice.