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Mortgage and gift letter
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DRR S/Pro
Picture of banjo
posted
So I have some family trying to buy a mobile home. I am still trying to get all the details, but they came to my wife asking her to sign a gift letter for $54k but no money will actually be gifted. Obviosly big red flag, and my wife didnt sign.

Feels like a scam or something.

Anyone familar with this kind of scenerio?
Trying to figure out what the game is as i am concerned my family is being scammed.

Thanks


Bill Simpkins
74 Nova
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60 1.27 (10/16)
1/8 6.03@111 (10/16)
Best 9.87@131 on the rev limitor 1 Feb 2013


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Posts: 1830 | Location: San Angelo | Registered: March 07, 2005Reply With QuoteReport This Post
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A gift letter is a legal instrument that clearly and explicitly states, without question, that a friend or family member “gifted” - rather than loaned - you money. You can use a gift letter for mortgage lenders who may be questioning a large influx of cash that suddenly showed up in your checking or savings account.


https://trustandwill.com/learn/gift-letter
 
Posts: 2963 | Location: Boon Docks, FL | Registered: March 22, 2005Reply With QuoteReport This Post
DRR S/Pro
Picture of banjo
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Thats what I dont get, they told them to just have my wife sign the letter and they will do the rest. Again, with no actual gift being given.


Bill Simpkins
74 Nova
SBC 406
3240 pounds
Speierracing heads

60 1.27 (10/16)
1/8 6.03@111 (10/16)
Best 9.87@131 on the rev limitor 1 Feb 2013


nova

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Posts: 1830 | Location: San Angelo | Registered: March 07, 2005Reply With QuoteReport This Post
DRR S/Pro
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Serious legal implications, I'd be careful.


Illegitimi non carborundum
 
Posts: 2336 | Location: OKC, OK | Registered: February 15, 2008Reply With QuoteReport This Post
DRR Pro
Picture of Brktracer
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Gifts over $10k have tax implications.
If that large sum was deposited at once it probably is a red flag
Just tell them to have the real “giver” sign the letter. Yeah right.
No way I would do that!


Matt Ward



 
Posts: 1389 | Location: South Carolina | Registered: March 20, 2004Reply With QuoteReport This Post
DRR S/Pro
Picture of banjo
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I am not aware of anyone that would give them that kind of money, the entire deal seems so bad.


Bill Simpkins
74 Nova
SBC 406
3240 pounds
Speierracing heads

60 1.27 (10/16)
1/8 6.03@111 (10/16)
Best 9.87@131 on the rev limitor 1 Feb 2013


nova

quarterpanelview

wheelie

FTI Converter
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Posts: 1830 | Location: San Angelo | Registered: March 07, 2005Reply With QuoteReport This Post
DRR Sportsman
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While I haven't heard of a gift letter, the limits have been raised to $14,000 without tax implications as a gift. They used to be $10,000, they could be higher now even.

I do remember anyone paying over 10K for anything in cash got reported.

Either way, it seems weird to me. It could be a legit way but I'd like to know more about it.


PS I could have a whole compound at 54K but I'm
looking at buying at the Jersey shore right now and scraping nickels together to make it happen! Lol.

Bracket racing is dieing around here and I'm also banned from my local track because the owner wants to billy bad ass!

Back to topic, let us know what you find out. I'd appreciate it.
 
Posts: 619 | Location: Atco, NJ | Registered: March 14, 2002Reply With QuoteReport This Post



DRR Sportsman
Picture of TD3550
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The annual gift exclusion is $15,000 for 2021, which means your donor doesn’t need to report anything if they give you less than $15,000. They’ll need to file a gift tax return if they give you more than that amount.

Normally a fast influx of cash/deposits, throws a red flag.

There are gift tax laws.

Falsifying legal documents can turn into form of mortgage and bank fraud.

Because the paperwork for your loan is entered into the record, a gift letter is then a legally binding document.

This message has been edited. Last edited by: TD3550,
 
Posts: 1409 | Location: Under a Truck | Registered: August 23, 2013Reply With QuoteReport This Post
DRR Elite
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Obviously the sign it and we will fill it in later is a red flag for you as it should be.


Foxtrot Juliet Bravo
 
Posts: 6398 | Location: Illinois | Registered: July 08, 2004Reply With QuoteReport This Post
DRR Sportsman
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Cleaning dirty money.
 
Posts: 519 | Location: Southeast | Registered: March 14, 2009Reply With QuoteReport This Post
DRR Sportsman
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As a former owner and operator of a mortgage company I can assure you this deal, as stated by your post, smells really bad. It appears that the dealer or broker has inflated the numbers to make the buyers equity position larger than it really is. This is called fraud. If this is ever audited and discovered somebody is going to jail, if the FBI gets involved is only gets worse. In the over 30 years I was involved in the mortgage industry it would amaze you the number of shady deals that came across my deck. I would suggest that your relative refrain from this activity.
 
Posts: 700 | Location: At the beach | Registered: August 05, 2003Reply With QuoteReport This Post
DRR S/Pro
Picture of banjo
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I assure you, my wife and I will not be a part of this.

I am just trying to understand how this works. The only thing that would make sense to me is an under the table note as that 54k would have to come from somewhere.

I will lead the horse to water, what happens beyond that is on them.


Bill Simpkins
74 Nova
SBC 406
3240 pounds
Speierracing heads

60 1.27 (10/16)
1/8 6.03@111 (10/16)
Best 9.87@131 on the rev limitor 1 Feb 2013


nova

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Posts: 1830 | Location: San Angelo | Registered: March 07, 2005Reply With QuoteReport This Post
DRR Sportsman
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Banjo, your correct in some aspects. The seller/dealer broker may have inflated the sales price, show a very large down payment, ergo: increasing the equity position of the buyer making the deal more appealing to the mortgage company, investor, bank or who ever. You guys are smart to walk away from this. If discovered by the above listed you have become complicit in mortage fraud and would be prosecuted for such. I have seen that happen many times.
 
Posts: 700 | Location: At the beach | Registered: August 05, 2003Reply With QuoteReport This Post
DRR Pro
Picture of Roger McGinnis
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Or it could be, that they have a box load of $100.00 bills that they want to use as a partial payment. Since there is no record of where the money is coming from (drugs), the bank has to assume that they are borrowing it from someone. A gift letter would start a trail of where the money came from. Steer clear.



ΜΟΛΩΝ ΛΑΒΕ
 
Posts: 559 | Location: Republic of Texas | Registered: January 16, 2011Reply With QuoteReport This Post



DRR Pro
Picture of SlyFox
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quote:
Originally posted by maliciousintent:
The seller/dealer broker may have inflated the sales price, show a very large down payment, ergo: increasing the equity position of the buyer making the deal more appealing to the mortgage company, investor, bank or who ever.


Yes - SCAM all the way, and the letter makes you a party to the fraud.


Mike
 
Posts: 1562 | Location: Marietta, GA | Registered: December 09, 2005Reply With QuoteReport This Post
DRR Sportsman
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Get an attorney and pay his advice fee. Don't ask all us gear heads on this forum. Obtw, that is fraud on a federal institution. The feds take fraud very seriously.


When everything is coming your way, your probably in the wrong lane.
 
Posts: 1009 | Location: Between a Rock and a Hard Spot, USA | Registered: December 06, 2001Reply With QuoteReport This Post
DRR S/Pro
Picture of banjo
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We won't have anything to do with it. It was never even a consideration. I was just wanting to know how the game worked.

We pass the info on to them. What they choose to do is on them.

I think its pretty bold to even ask someone to sign it, knowing it would be untrue.


Bill Simpkins
74 Nova
SBC 406
3240 pounds
Speierracing heads

60 1.27 (10/16)
1/8 6.03@111 (10/16)
Best 9.87@131 on the rev limitor 1 Feb 2013


nova

quarterpanelview

wheelie

FTI Converter
www.speierracingheads.com

 
Posts: 1830 | Location: San Angelo | Registered: March 07, 2005Reply With QuoteReport This Post
DRR S/Pro
posted Hide Post
quote:
Obtw, that is fraud on a federal institution. The feds take fraud very seriously.

If you're going to do time you want to make sure it's in a federal facility, opposed to a poorly funded state prison.


Illegitimi non carborundum
 
Posts: 2336 | Location: OKC, OK | Registered: February 15, 2008Reply With QuoteReport This Post
DRR Sportsman
Picture of KWig
posted Hide Post
Back in Clintons 2nd term, when he changed the bank/mortgage laws, one of my guys was trying to buy a house. He comes up to me after work one afternoon, and asked me if I would write him a check for $10k, to show for a down payment, on his house deal. He saaid the agent told him, to have me write it out as a gift, and then 2 days later, cancel the check, but it would show a 10k DP, so he could get a FHA loan.
I had never heard of that before, but it seemed very wrong, immediately. I told him and not NO, but, HELL NO, and to find a real real estate agent, and not a used car saleman that changed jobs. That was bank fraud, as I can see it.
I told him, you're a great guy, but I'm not going to prison, so you can get in a house, with no money down.


You have to put in the effort, to get anything out of it.
 
Posts: 736 | Location: Cumming Ga | Registered: January 07, 2007Reply With QuoteReport This Post
DRR Pro
Picture of SlyFox
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I think the scam works something like this...

Seller of a property gets an inflated appraisal after making a kickback to the appraiser, then gets a buyer to make a false down payment (this is where your gift letter comes into play) so the mortgage company will make the loan at the inflated sales price.

Seller walks away with fraudulent profit due to inflated sales price, makes a kickback to the buyer who then never makes any payments, defaults on the home, and it goes into foreclosure. Mortgage company gets left holding the bag.


Mike
 
Posts: 1562 | Location: Marietta, GA | Registered: December 09, 2005Reply With QuoteReport This Post
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