I'm hoping to go conventional or Mycommunity.  If my entire down payment is a gift, which is 20%, is this allowed?  I've spoke to a few lenders and got mixed feedback.  My mid score is 645 and my ratios are low.

If you are looking at conventional, gifts are allowed but the borrower must be bringing at leat 5% of their own funds to the table in addition to the gift. With a 645 credit score, you may be better off looking at FHA which does NOT have the risk based adjustments that you will find with conventional loan products and also does not have gift restrictions.

Best advice is to work with a lender/broker that can provide you with numerous different options to compare so that you can make a decision on what makes the most sense for you.

Lisa, here is what you do. Take the gift money and deposit it into your account. Do not touch the money and let it season for two months. On the third month is when you start the transaction. Why I say to season that gift money is because, we only ask for two months bank statements - if it was deposited the month before that, we would not need to source the funds. If the funds are needed to be sourced (because they were not seasoned for two or more months yet), the underwriters would be asking for the person who gave the gift to provide bank statements of where the funds come from their account and where it got put into yours, then need to provide a gift letter, etc. It can get messy and involve people that really shouldn't have to give their personal information for your transaction. I hope that helps!

Also - with your FICO score, take a look at your FHA options. You should be able to get a lower rate that way. The LLPA's are very high if you were to go conventional and you wouldn't NEED a full 20% down.

All of the earlier advice is 100% correct. To expand on the FHA route vs. conventional. With your credit score there is a 3.00% adjustment to the price of your loan. Simply the difference between a rate of 5.500% & 6.500%. Even though the FHA loan will have mortgage insurance and a funding fee the overall cost of the FHA loan will be lower. Example:

$150,000 purchase 20% down

Conventional @ 6.50% P&I $758.48        FHA @ 5.50% P&I + MIP = $747.93

Plus in 5 years you can drop the monthly MIP cost and your payment goes down $54.66.

FHA as mentioned before would also eliminate the need to season the gift funds for 60 days.

Have a great weekend!

The 20% down can be all gift-you would not need 5% of your own funds.  Less than 20% down, different story.

Tony, I believe that you are correct after doing further research, thank you.