How This First-Time Homebuyer Needed Around $1,000 at Closing

A real Florida homebuyer. A real closing. And a financing strategy that helped dramatically reduce the amount of money he needed at closing.

Buying your first home can feel out of reach, especially when you start thinking about the down payment and closing costs.

But the amount of money you need to buy a home may be different than you think.

In this real client story, we helped a first-time homebuyer combine Down Payment Assistance with a Seller Credit toward closing costs. The result? He needed around $1,000 at closing.

Closing Statement — Actual Client Figures

Diego's Transaction

What Diego expected to bring

$10,000–$15,000

Deposit required on the home

$2,000

Returned to Diego at closing

$982

Net cash needed to close

~$1,000

Hear it from the buyer

A one-minute look at what actually happened at the closing table

First-time homebuyer client story - around $1,000 out of pocket for his home purchase

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Diego, first-time homebuyer · Family Home Loans client

This video describes one borrower's actual transaction. Individual results vary. Down Payment Assistance programs, seller contributions, loan terms, eligibility requirements,
and funds required at closing vary by borrower and transaction.

How Did We Make It Work?

There wasn't one magic loan that made this happen.
Instead, we looked at the entire transaction and found ways to make the different pieces work together.

Down Payment Assistance

The buyer qualified for a Down Payment Assistance program that helped reduce the amount of his own money needed for the purchase.

Down Payment Assistance programs can vary significantly. Some may help with the down payment, closing costs, or both, depending on the particular program.

Seller Credit toward closing costs

The purchase contract also included a Seller Credit.

A Seller Credit, sometimes called a Seller Concession, allows the seller to pay certain eligible closing costs on behalf of the buyer, subject to the requirements and limits of the applicable loan program.

We put the pieces together

Rather than looking only at the buyer's down payment, we looked at the complete financing picture.

By combining the available Down Payment Assistance with the negotiated Seller Credit, this buyer was able to significantly reduce the amount of money he personally needed at closing.

The total amount he needed out of pocket for this transaction was around $1,000.

That doesn't mean every buyer can purchase a home with $1,000.

It does mean it's worth finding out what options may be available
before assuming you need tens of thousands of dollars to become a homeowner.

First-time homebuyer FAQ

Possibly. The amount of money you need depends on your loan program, purchase price, down payment requirement, closing costs, available assistance programs, seller contributions, lender credits, and other details of the transaction. Some qualified buyers may be able to combine different sources of assistance to substantially reduce the amount of their own funds required at closing. The best way to know is to review your specific financial situation and the programs available to you.

In some transactions, yes. Down Payment Assistance and Seller Credits serve different purposes and may be used together when permitted by the applicable mortgage program and Down Payment Assistance program. Seller contributions are also subject to limits and restrictions, so the structure needs to be reviewed before assuming a particular combination will work. That's exactly why planning the financing and the purchase offer together can be so important.

A Seller Credit is an amount the seller agrees to contribute toward certain eligible buyer closing costs. Depending on the loan program and transaction, those funds may help cover eligible costs associated with purchasing and financing the home. There are limits on seller contributions, and not every cost can necessarily be paid by the seller.

Down Payment Assistance, often shortened to DPA, refers to programs designed to help eligible homebuyers with some of the upfront costs associated with purchasing a home. Programs can differ substantially. Depending on the program, assistance may come in the form of a grant, second mortgage, deferred-payment loan, forgivable loan, or another structure. Income limits, purchase-price limits, property requirements, homebuyer education requirements, geographic restrictions, repayment provisions, and other eligibility guidelines may apply.

Not always. Some programs are specifically designed for first-time homebuyers, while others may also be available to eligible repeat buyers. Also, the definition of a “first-time homebuyer” can vary by program. Some programs may consider someone a first-time buyer if they haven't owned a primary residence during a specified period. We can review the programs currently available and determine which ones may fit your circumstances.

There isn't one number that applies to everyone. Your required funds can depend on your down payment, closing costs, prepaid expenses, earnest money deposit, loan program, available assistance, seller contributions, and the specific property you're purchasing. That's why an online down-payment percentage alone doesn't tell the whole story. A mortgage pre-approval can give you a much clearer picture of both what you may qualify to purchase and approximately how much money you may need to complete the transaction.

It depends. Mortgage programs establish limits and rules governing seller contributions. Your purchase price, loan type, down payment, occupancy, and the actual amount of eligible closing costs can all affect how much the seller may contribute. A Seller Credit also needs to be negotiated as part of the real estate transaction. We can help determine what may be permitted under your financing so you and your real estate agent can structure an offer appropriately.

Potentially, yes. There are Down Payment Assistance programs that may be compatible with FHA financing, provided both the borrower and transaction meet the requirements of the FHA loan and the particular assistance program. Availability and eligibility vary, so the specific program should be reviewed before making an offer.

Florida homebuyers may have access to various state, local, lender-sponsored, and other Down Payment Assistance programs, depending on availability and eligibility.

Not necessarily. A seller will typically be concerned with whether the buyer can successfully complete the purchase and whether the financing terms work for the transaction. Good communication among the buyer, loan officer, and real estate agent can be especially important when an assistance program is involved. Before an offer is submitted, we can help your real estate agent understand the financing structure and any program requirements that could affect the transaction.

The first step is a free mortgage consultation and pre-approval. We'll review your income, assets, credit, debts, anticipated purchase price, and homeownership goals. We can then evaluate loan programs and any available assistance options that may fit your situation.
The goal isn't simply to answer:
“How much house can I qualify for?”
We also want to answer:
“What is the smartest way to structure the financing for my situation?” We help you build a clear Mortgage Plan.

Think You Need Too Much Money to Buy a Home?

Don't rule yourself out based on what you've heard online or what someone else
needed to purchase their home.
This real buyer's story is one example of what can happen when the financing, available
assistance, and purchase contract work together.

Your numbers will be different. Let's find out what they actually look like.

Ready to Explore Your Options?

START MY MORTGAGE APPLICATION SCHEDULE A CALL WITH TONY MENDEZ

All loans subject to approval. Program availability, eligibility, terms, conditions, and required funds may vary. Down Payment Assistance is subject to applicable program requirements and available funding. Seller contributions are subject to applicable loan program limits and the terms of the purchase transaction. This client story represents an individual transaction and is not a guarantee of similar results. Equal Housing Opportunity.