Step 5 to Buying a Home - Get Your Down Payment Ready
Now that you've received detailed information from your mortgage lender about your home loan down payment options, we recommend moving your down payment into your checking account or other bank account from which you will be able to withdraw the money with no penalty fee or significant delay.
Don't forget, in addition to your down payment, you'll also be responsible for roughly closing costs that are typically 2.5% of the home's purchase price.
If any of these funds are going to be gifted to you from a family member, you need to let your mortgage lender know right away so he or she can get approval from the underwriter for the funds.
At the beginning of the home purchase process, the lender will give you an estimate for the amount of down payment and closing costs. We always advise our clients to move a little extra money into their checking account, just in case the need arises. If you don't use the extra money, you can always transfer it back into your savings account or investment account for safe keeping.
Once you have an agreement to purchase a home and you've progressed through the majority of the home purchase process, your mortgage lender will email you a closing disclosure (CD) which will include the total amount of money needed to close along with instructions to wire transfer the funds. While we wish the precise amount was available much earlier in the process, the total amount is usually not available more than 3-4 days before closing. You’ll wire transfer these funds in one lump payment the DAY BEFORE CLOSING. It is crucial that these funds be wire transferred the day before closing at the latest as the Escrow company cannot accept it the day of closing. At closing, any overage/extra money you paid will be refunded back to you at the very end of the closing via a check.
If you have any questions on the down payment, please don't hesitate to drop us a line at (253) 656-6966 or by completing the form below.