The letter must explain who is gifting the money, where the donor's funds are coming from and the relationship between the donor and the recipient. This guide explains how to document gift funds for a mortgage and meet lender requirements.What should you include in a gift letter? Here's a sample gift letter you can use to prove that the money is truly meant as an outright gift, with no expectation of repayment. A mortgage gift letter is a document that helps satisfy the requirement that a borrower's down payment funds come from legitimate sources. Your parents will need to file the proper forms with IRS declaring the gift. So no potential consequences of gift tax. Yes, all lenders will require a gift letter. Although you may have the funds, the lender needs to confirm that you won't have to repay the gift. A gift letter is a legally binding document evidencing proof that the money from parents is a gift, not a loan.