About Down Payments

What is a down payment?

A down payment is simply the cash portion paid by a buyer from his and/or her own funds, as opposed to that portion of the purchase price which is financed.

Where can a down payment come from?

• VA (Veterans Administration) loans require a "0" down payment
• FHA (Federal Housing Administration) loans allow down payments to be gifted by an uninterested party.
  • Family Member
  • Employer
  • Non-profit Organization
• RIHMFC (Rhode Island Housing & Mortgage Finance Corporation) Programs
  • "Zero Down" Program (available in rural areas)
  • FHA (3.0% - 5.0% down)
  • VA (0 down)
  • Convention (requires 3.0% down of which $1,500 must be borrowers own saved funds)
  • Jump Start (minimal down payment)
  • Silent Second Mortgages in conjunction with above programs to qualified applicants whose income in within certain levels.
• Conventional Loans
  • Normally requires a 3.0% - 5.0% down payment based on the purchase price.
• Other Sources of Down Payment Money:
  • Grants (which are available in certain cities and towns)
  • Gift of Equity from parents which requires 20% of purchase price.
  • Rent with Option to Purchase - The portion of a rental payment which exceeds the market rent can be applied to the down payment if there is a valid Rental/Purchase Agreement in effect.
  • 401K Funds (check with your employer)

Buyer Resources

Seller Resources

Finance Resources

Northeast Weekly Mortgage Rates Provided by Freddie Mac 30-yr fixed: 6.10% 15-yr fixed: 5.65% 1-yr ARM: 5.06%