How large a downpayment will I need?
In most loan programs, at least a portion of the down payment must come from your own funds. This demonstrates to the lender that your home is an investment that is important to you. For example, if the loan program you select requires a 5% down payment, and the purchase price on your home is $100,000, your down payment will be $5,000. However, you may only have to provide a 3% down payment from your own funds, totaling $3,000. The remaining 2%, or $2,000, can be a gift or grant. Some peolpe contribute to their down payment by borrowing against the equity in their profit-sharing or 401(k) plans.
