With the devaluation of real estate and historically low interest rates, many of my clients are wondering if they can help their children into a home.  

But what are the down payment restrictions?

* If your child doesn’t have at least 5% down,  they may still be eligible for FHA financing which is available with 0 down.

*If you are giving your child a 20% down payment, they will be eligible for both Freddie Mac and Fannie Mae financing.

*If you want to gift less than 20% and the down payment will be less than 20%, deposit early in the kid’s account.  The bank may be unaware that a gift was made.  Banks typically ask for two months bank statements to verify the average balance.