Gift of Equity

Gift of Equity

A sale price below market value,where the difference is a gift from the sellers to the buyers.

Such gifts are usually between family members. Lenders will usually allow the gift to count as a down payment. See Down Payment/Gift of Equity.

The Mortgage Encyclopedia. Copyright © 2004 by Jack Guttentag. Used with permission of The McGraw-Hill Companies, Inc.
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The buyer assumed a $172,000 mortgage, with the $43,000 difference accounted for as a gift of equity from the seller.