Document background
The Gift Letter For Mortgage is an essential document in Indonesian property transactions where family members or other donors contribute funds toward a property purchase. This document became increasingly important as Indonesian banks and financial institutions enhanced their due diligence requirements for mortgage applications. The letter serves multiple purposes: it satisfies lenders' requirements for verification of down payment sources, complies with Indonesian banking regulations regarding fund source transparency, and provides legal protection for all parties involved. The document must be structured to meet both Indonesian civil law requirements and, where applicable, Islamic law principles regarding gifts (hibah). It typically includes detailed information about the donor, recipient, gift amount, and property details, along with explicit declarations about the non-repayable nature of the gift. This documentation is particularly crucial in Indonesia's property market, where intergenerational financial support for property purchases is common practice.
