Business and Finance

Gift letters are a legally recognized document in the banking and financing industries that allows a loan borrower to prove more funds and capital then he or she may have originally had. The purpose of a gift letter is to prove to the lender that the borrower has enough money to back the loan. Sometimes the borrower may not have enough balance in their bank account, so they tell the bank they are receiving gift money from a friend or family member. To prove that this is not a second loan paying for the first loan, the person must have a written statement from the giver that the money is not expected to be repaid in the future. If you are trying to get a loan for buying real estate investment property than using a gift letter is a good option if you need to prove a bit more financing than you already have.