I would like to share a blog post by a realtor who’s a customer of mine. She gives great advice to newly weds.
If you’ve walked through a Crate and Barrel or a Bed Bath and Beyond lately, you’ve seen the joyful, yet overstimulated faces of those couples planning their lives together…..one strainer, china place setting and over stuffed pillow at a time. The stores usually supply the couple with a scanner, so that they can add items to their registry themselves. If you ever stumble across a soon-to-be bride, and she has one of those scanner things, you better move, because she sees the pink KitchenAid mixer, and she can already envision it on her kitchen island. It’s an exciting time, I get it. I’ve been there myself. I spent an hour pondering if I wanted a Le Creuset skillet or an All-Clad skillet on my wedding registry.
All that being said, where do all these newfound registry delights end up? The couple may already own a residence together or individually. If they are renting, they could be chafed sending hundreds or thousands of dollars to their landlord every month. Their reason for renting may be because they are waiting to come up with a down payment. If thats the case, and the couple ultimately wants to trade their rent check for a mortgage, setting up a FHA Registry could prove beneficial. If you haven’t heard of a FHA Registry, you aren’t alone. There is a little-known HUD program that allows couples to amass cash gifts from friends and family into a down-payment on a home when using a mortgage loan backed by the Federal Housing Administration (FHA). The FHA Registry works like a traditional registry but is even more flexible. The bride and groom visit their choice of FHA mortgage lenders and set up what is essentially a custodial savings account for the dedicated purpose of funding their down payment. Then they provide the details to friends and family. In turn, the couple’s benefactors can deposit funds directly into the account, or can simply hand cash or checks to the couple for deposit into the account. These arrangements offer additional flexibility beyond the traditional down payment gift rules applicable to FHA loans, which require that gift funds (vs. money the couple saved up from their own income) be “sourced,” meaning borrowers must document their family relationship between themselves, show where the giver got the funds from and produce a letter from the giver stating that the funds are a gift and not a loan. It simply wouldn’t make sense for borrowers to jump through these traditional gift funds hoops for 50 or 150 different small, cash gifts. With the FHA Registry program, they don’t have to provide anything more than “lender and borrower certification of the funds.” In fact, the program can even be used outside of a wedding gift context, on what HUD’s letter of explanation described as “other legitimate occasions where substantial gifts are typically received by an individual or individuals that may in turn be applied toward the purchase of a home.” So, college graduates and parents expecting a baby should all explore the possibility of using the FHA Registry to parlay their well-wishers’ gifts into a down payment on a home.
In 2014 the median age of first marriages was 29 for men, and 27 for women. More than likely they have both had time to accumulate their fair share of stackable mixing bowls and bath towels. Now, I’m going to throw some numbers around. Lets say a couple invites 150 guests to their wedding. Of those 150, 50 are close friends, or close relatives. The Knot.com says the ballpark amount that group would spend on a wedding gift would be between $100.00 to $150.00. If that holds true that would mean just from those 50 guests, the newlyweds would receive gifts totaling between $5,000 to $7,500. Lets say the remaining 100 guests are co-workers, or a distant family friend or relative. The Knot.com estimates this portion of your guest list will spend between $50.00 to $75.00. That would mean an additional $5,000 to 7,500 worth of goods. That equals between $10,000 to 15,000 that could be used for a down payment if the couple is using the FHA Registry program.
I would think that many a newlywed would rather have that kind of cash flow (which would more than make the FHA required 3.5 percent down payment on a $275,000 home) than have 150 items like blenders, dust ruffles and coasters they’ll have to put in storage until they can scrape up the cash to move out of their rental. Owning a home is an investment that can build equity! A $100.00 set of knives loses value after the first use. As for a wedding photographer (If you’ve stuck with me this far, I have to throw this in) I would recommend Adam Brennan in Louisville, Ky. www.picturesbyab.com. He took the amazing picture you see above. If you are looking for a Realtor in Louisville, Ky, I would love to help you and I can answer any questions you may have www.charlsiefulmore.semonin.com. Thanks for reading!
Residential Real Estate Agent | Helping Clients Buy and Sell Homes in Louisville, Kentucky
-Charlsie Fulmore *REALTOR-Semonin Realtors