Calculate gift of equity for real estate investments and properties
Enter property fair market value and sale price. The difference is a gift of equity that counts as down payment for the buyer.
Parents sell their $400,000 home to children for $320,000. The $80,000 difference is gift of equity, serving as 20% down payment.
Typically family members (parents, siblings, grandparents). Some lenders have specific requirements. Gift must be documented with letter and form.
Yes, the difference between market value and sale price counts toward down payment requirements, potentially avoiding PMI at 20% equity.
Gifts over the annual exclusion ($17,000 in 2023, $34,000 for couples) may require gift tax return but rarely trigger taxes due to lifetime exemption.