Where is Your Down Payment Coming From?

August 7th, 2014

I sometimes have a client tell me they are getting their down payment to buy a new home from some interesting sources. I have had client sell an antique guitar collection on eBay, sell a car, get cash from a suitcase under their bed, and sell an art collection, among many more interesting stories. However, homebuyers need to be aware of what is allowed and what is not allowed. Some sources of down payment are not allowed.

How Much Down Payment Do I Need?

You cannot:

-Borrow from an unsecured line of credit

-Cash advances from credit cards

-Get a gift from a friend or a distant family member

You can:

-Get a margin loan against stocks

-Get a loan against CDs

Borrow against a 401(k) or TSP

-Get a gift from an immediate family member

-Sell something personal like art, jewelry, cars or guitars. (Just make sure you create and copy sales invoices, checks, deposit slips and an entire paper trail.)

Do You Have Your Own Cash Saved For A Down Payment?

As I always suggest, make sure not to withhold information from your mortgage loan officer, and be fully forthcoming about all aspects of your loan, especially where you are getting your down payment. Not openly discussing these sorts of things could cause a problem down the line in the transaction.

3.5% Down Payment FHA Loans Versus 5% Down Conventional Loans

You can schedule a call with me at your convenience to talk about what will work for your situation.

Brian Martucci is a loan officer for Capital Bank Mortgage, a division of Capital Bank. He has been in the mortgage industry since 1986 and has served in a number of roles, including loan processor, loan officer, mortgage broker, branch manager, and vice president. Brian Martucci – NMLS# 185421. His opinions do not necessarily reflect the opinions and beliefs of Capital Bank Mortgage or Capital Bank. Capital Bank, N.A.- NMLS# 401599. Click here for the Capital Bank, N.A. “Privacy Policy”.

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