Buying Home With Gifted Down Payment From Father - Protection In Case of Divorce?

Dali748

New Member
Jurisdiction
New Jersey
Hi,

So I've been down this road before in my first marriage. After we were already married, we purchased a home and my father gifted us money for the down payment. Fast forward 4 years, we ended up getting divorced and my ex-wife got 50% of the proceeds from selling the house. She contributed in paying 50/50 for the monthly house expenses (inc. mortgage) with me for those 4 years but she also made out with 50% of my father's gifted down payment money.

I'm about to propose to my new girlfriend and my father said he would be generous enough to gift us money for the down payment again when my future wife and I decide to purchase a home. I'm not looking to repeat history and I want to protect my father's money and also be fair to my new wife if she'll be contributing 50/50 to the monthly house expenses (inc. mortgage).

Is there a way I can purchase a home and have it setup so if we end up getting divorced that my father could recoup the down payment he provided to me to help purchase the home? And then if there are any profits after this I would split 50/50 with my wife?

Thank you!
 
You've asked this question on another forum, and received replies. To summarize: If your father gives you a GIFT, then it is no longer his money. If he gives this gift to you and your wife together, then it belongs equally to each of you. Your first wife was entitled to "credit" for 50% of it...nothing untoward happened.

If your father intends to give you (plural) a gift again, then it will no longer be his money and he can't expect to get it back.

Your mortgage lender will want to know if the funds are a gift or a loan.
 
And father will have to sign a gift letter stating that it's a gift.

If you want to avoid splitting the gift with your wife you'll need a pre-nuptial agreement.

Otherwise, when you use the gift toward the down payment, resign yourself to splitting it with your wife should you be divorced.
 
And father will have to sign a gift letter stating that it's a gift.

If you want to avoid splitting the gift with your wife you'll need a pre-nuptial agreement.

Otherwise, when you use the gift toward the down payment, resign yourself to splitting it with your wife should you be divorced.

Thanks for the reply!

I'll look into doing this "pre-nup". I know there is a stigma when it comes to having a future spouse sign a pre-nup, where it almost feels like you're already thinking the marriage will fail; but I guess I have to convey this to my future spouse, as this is mainly for my father and protecting his assets since he's been burned before on this.
 
Is there a way I can purchase a home and have it setup so if we end up getting divorced that my father could recoup the down payment he provided to me to help purchase the home?

Yes, the deed could name ONLY your generous father.

You'll pay rent at least 110% of the note each month.

If you and your intended DIVORCE one day, father's home won't enter the discussion because he'll be your landlord.

There is one other way, that works equally as well.

I'll not disclose that way.

You're a clever guy.

You'll discover it on your own.
 
Is there a way I can purchase a home and have it setup so if we end up getting divorced that my father could recoup the down payment he provided to me to help purchase the home? And then if there are any profits after this I would split 50/50 with my wife?

Yes. You and your wife-to-be or the two of you and your father can enter into a contract that can say pretty much whatever you want it to say. Consult with a local attorney for advice.

this is mainly for my father and protecting his assets since he's been burned before on this.

Burned? I don't think so. He gave you a gift. A gift is money or property that you give to someone unconditionally and without any expectation of ever getting it back Whatever happened after he made the gift was none of his concern. If his intent was to give a "gift" only on the condition that you and your first wife would never get divorced and that, if you got divorced, he'd get his money back, then that's something he could and should have arranged at the time he gave you the money. If he wants again to give you or you and your girlfriend a gift, that's his prerogative. If he doesn't make arrangements to get his money back if the marriage doesn't work out, then maybe he truly intends to make a gift. On the other hand, if he wants his money back, then what you're really talking about is a loan, not a gift.

Keep in mind that, at some point, you are likely going to have to represent to your mortgage lender that the money you use as a down payment is yours and that you are not now and never will be under any obligation to pay it back. Just make sure you don't commit mortgage fraud.
 
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