Legal Question in Real Estate Law in New Jersey
repayment of down payment gift
my partner and I bought a house in April 2004. She gifted me the down payment of $45,000.00. ( in a letter said she was gifting me, her sister, the money) that is how the mortgage company arranged for us to do it, since it was my credit that they used to obtain the mortgage. ( her credit is bad) both names are on the deed. we are now not together and have to sell the house. she wants her down payment back, the $45,000.00, that was gifted to me when we bought it. does she have a legal right to that money? i know it was hers, but in gifting the down payment to me does she lose the right to it?
2 Answers from Attorneys
Re: repayment of down payment gift
The answer depends upon the "true" intent of the parties. Was the "gift" actually intended to be a gift, or was this just a phrase used to satisfy the mortgage company that no outside financing was being used in the purchase that might disturb their lien position or disqualify you from a more favorable interest rate. Frequently parents or other family members, or friends make "gifts" and issue gift letters, to assist in obtaining a mortgage or getting more favorable rates, when a true gift is not intended, but merely a loan not represented by a note and/or mortgage. Not being a party to the initial transaction, I cannot comment other than to say if a true gift was intended, he/she is wrong, but if this was merely an accomodation, he/she is right.
Re: repayment of down payment gift
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