Yes. Home Possible® Freddie Mac CHOICERenovation® follows Home Possible gift-fund rules — eligible donors can cover down payment and closing costs with a proper gift letter and transfer trail, while renovation dollars stay in escrow for licensed contractors under Freddie Mac CHOICERenovation® draw rules.
Family help is one of the most common ways Home Possible buyers fund a 3% down payment and closing costs. Because this combo is a conventional Freddie Mac product, gift funds follow conventional documentation — gift letter, donor eligibility, and a clear paper trail from donor to borrower.
Gifts do not replace contractor bids or renovation escrow. Labor, materials, contingency (10% / 15% if utilities are off), draw admin fees, and up to six months of financed PITI still sit in the Freddie Mac CHOICERenovation® renovation budget released through five draws plus a final 1004D inspection.
Ryan and Steve prepare the gift package early so wire timing never collides with contractor bids, LPA Accept findings, or your 15-month completion clock.
Clear documentation keeps gift funds from delaying a fixer-upper closing.
States the gift amount, donor relationship, property address, and that no repayment is expected or implied.
Recent donor bank statements or other proof showing the funds existed before the transfer.
Wire receipt, cashier's check copy, or deposit trail showing funds left the donor and arrived with you.
Any of your own cash used alongside gifts must also clear asset documentation for LPA.
| Item | Gift funds | Renovation escrow |
|---|---|---|
| Purpose | Down payment & closing costs | Labor, materials, contingency |
| Who receives money | Borrower / closing | Contractors via draws |
| Documentation | Gift letter + transfer trail | Bids, inspections, 1004D |
| Can cover rehab? | No — cash to close only | Yes — financed into the loan |
| AMI still applies? | Yes | Yes |
Related Home Possible Freddie Mac CHOICERenovation® guides and cash-to-close resources.
97% LTV / 3% down for eligible Home Possible borrowers.
Stack grants and DPA with Home Possible Freddie Mac CHOICERenovation®.
Standalone Home Possible gift-fund documentation rules.
AMI rules that still apply when using gifts.
Purchase plus rehab in one conventional mortgage.
Full guidelines, calculator, and all 20 guides.
Yes. Eligible donor gifts are commonly allowed for the full down payment and closing costs on Home Possible® Freddie Mac CHOICERenovation®, subject to a gift letter, documented transfer, and LPA Accept underwriting.
Typical eligible donors include relatives by blood, marriage, or legal adoption. Fiancé/fiancée and domestic partners may qualify in many cases. We confirm donor eligibility before funds move.
No. Gifts cover borrower cash to close (down payment and closing costs). Renovation dollars still sit in escrow, released through five draws plus final inspection (1004D) to licensed contractors.
Often yes. Gift funds can fill remaining cash needs after a grant or assistance credit when each program's rules are followed. We map the stacking order so cash to close stays accurate.
Ryan & Steve prepare the gift letter package and keep donor wires aligned with your rehab escrow timeline at Luminate Bank.
Home Possible and Freddie Mac CHOICERenovation® are registered trademarks of Freddie Mac. All loans are subject to credit and property approval. Program guidelines, income limits, LTV limits, and pricing are subject to change without notice and may not be available in all areas. This website is not affiliated with or endorsed by Freddie Mac, Fannie Mae, HUD, or any government agency. Information is for educational purposes only and is not a commitment to lend.