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What can I use for a down payment?

The down payment is the difference between your loan amount and sales price.  Closing costs are additional.  The down payment and closing costs make up your cash to close.

Down payment funds can come from a variety of sources, like:

• You can use liquid assets like a checking, money market or savings account
• You can liquidate investments like stocks, bonds, mutual funds, ETFs.
• You are allowed to pull money out of a retirement account like an IRA or a 401k.
• You are allowed to use governmental assistance.
• A family member may provide you with a gift that does not need to be repaid.  You cannot receive a down payment gift from a friend or anyone involved in the purchase transaction.  This is because if your friend gives you money for a down payment, the mortgage underwriters of the world would not believe that that is a gift rather than a loan that has to be repaid.
• Your employer may assist with a down payment if they have a program to fund down payment for employees.
• You can use a secured loan against your assets, like a home equity loan or line, or a securities based line of credit.

Questions?  Ajaffe@firsthome.com or 240 479 7658

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