Down payment
Your equity contribution toward the purchase.
Resources · Understand the money
Closing Costs & Cash to Close
The purchase price isn't the amount you bring to closing.
Estimated cash to close
More Than the Down Payment
Down payment+Closing costs+Prepaids / escrow funding−Deposit already paid−Applicable credits=Estimated cash to close
Illustrative only. Actual costs, taxes, insurance, escrows, credits, and required reserves vary by transaction and program.
Closing costs
Costs associated with originating and completing the transaction.
Prepaids
Items such as prepaid interest, homeowners insurance, and applicable tax or escrow funding.
Credits
Eligible seller or lender credits that may offset certain closing costs subject to program rules.
Seller Credit vs. Price Reduction
Seller credit
May offset eligible closing costs, which can reduce the buyer's immediate cash need, subject to program and transaction limits.
Price reduction
Reduces the financed purchase price, but the resulting payment change may be modest compared with the same dollars applied to eligible costs.
A seller credit can sometimes create more immediate value when cash to close is the constraint. The better choice depends on the transaction, appraisal, program rules, and buyer priorities.
Points vs. Lender Credits
Points
Pay more upfront → potentially lower interest rate.
Lender credit
Potentially higher interest rate → lender contributes toward eligible closing costs.
A clear next step
Still Not Sure Where to Start?
You don't need to diagnose your own mortgage. Tell me what you're trying to accomplish and we'll work backward from there.