A parent gives $25,000 toward a down payment and the file holds a signed letter and nothing else. Under a policy requiring gift receipt to be verified, what evidence is missing beyond the gift letter?
Correct Answer
C) Document the transfer as well: the letter alone does not evidence it
C. Evidence of the transfer is still missing. A signed statement about a $25,000 gift documents the donor’s representation, not the movement of the money. The policy in the question separately requires proof of receipt; appropriate transfer records address that gap. Scope and exceptions: The question supplies its documentation policy. Fannie Mae’s gift rules illustrate acceptable evidence, including specified transfers to a closing agent; not every gift must first enter the borrower’s account. Source: B3-4.3-04, Documentation Requirements and Verifying Donor Availability of Funds and Transfer of Gift Funds — https://selling-guide.fanniemae.com/sel/b3-4.3-04/personal-gifts
Why This Is the Correct Answer
C. Evidence of the transfer is still missing. A signed statement about a $25,000 gift documents the donor’s representation, not the movement of the money. The policy in the question separately requires proof of receipt; appropriate transfer records address that gap. Scope and exceptions: The question supplies its documentation policy. Fannie Mae’s gift rules illustrate acceptable evidence, including specified transfers to a closing agent; not every gift must first enter the borrower’s account.
Why the Other Options Are Wrong
Option A: The parent must be added to the loan for the $25,000 to be usable
Making the parent a borrower does not supply the missing transfer evidence.
Option B: The letter is sufficient, as it states that no repayment is expected
A statement that repayment is not expected does not prove receipt.
Option D: The gift must be seasoned in the borrower account for 60 days first
Waiting 60 days is not a substitute for the receipt evidence required by this policy.
Exam Tip
A gift letter and a receipt record answer different questions.
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