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Down
Payment Guidelines
Generally a borrower must have a minimum of 5% down on a purchase that
can be verified from acceptable sources. The only exception are for first
time home buyers, 100% financing (such as VA loans) and FHA financing
(3% down).
Acceptable sources of funds include checking/savings accounts, money from IRA’s and
Keogh accounts, sale of assets, stocks and other investments and borrowed funds against a
secured asset (i.e. car, real estate, life insurance, etc.). FHA, in addition, permits
gifts from family members, non-profit agencies, or government agencies as well as the
aforementioned sources. However, not acceptable sources of funds
include the following: cash on hand, proceeds from a personal or
unsecured loan, cash advance from a credit card, or any cash for which the source cannot
be verified. Recently FNMA and FHLMC are offering
flexible first time home buyer programs which permit a borrower to use funds from a gift,
a loan, cash advance from a credit card, or cash on hand.
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