EN
ES
Start with the full picture
Your down payment is only one part of the money needed to buy a home. The estimated cash to close also includes closing costs and adjustments for deposits, seller credits and other amounts. The amount changes with the property, loan and timing. Ask for a Loan Estimate based on a specific scenario before treating a number as your budget.
For example, if a home costs $400,000 and you put 5% down, the down payment is $20,000. That does not mean $20,000 is all you will bring to closing. Taxes, insurance, lender charges, title work and other items may increase the amount. A deposit you already paid generally reduces the remaining amount due.
Why prepaid items surprise buyers
Some charges are for services needed to close. Others cover future expenses, such as the first year of homeowners insurance, daily interest and money placed in an escrow account for taxes and insurance. Property taxes in Florida and insurance costs vary by home and location, so an early estimate can change after you choose a property.
Ask which fees the lender controls, which come from other providers and which depend on your closing date. The Loan Estimate separates these categories and shows an Estimated Cash to Close figure on page two.
Keep a cushion after closing
A bigger down payment can reduce a payment or mortgage insurance, but it also uses cash you might need for repairs, moving or emergencies. Compare more than one down payment scenario, including the monthly payment and the money left in reserve. If someone is helping with gift funds or if you expect a seller credit, tell your loan originator early so the funds can be documented under your program’s rules.
The best starting point is a comfortable payment and a realistic amount of cash available both before and after closing.
General information only. Programs, eligibility and costs vary. This article is not a loan offer, approval, rate quote or financial advice.
Explore the cash-to-close guide · All articles · Contact Len