Ruth Mills Team
Prudential California Realty
Ph: 858.459.9109
Fax: 858.459.9108
ruth@millsteam.com

The Down Payment
The amount you have available for a down payment will affect what types of loans for which you can qualify. Down payments typically range from 3 to 20 percent of the sales price for the property.

Other alternatives:
Borrow the down payment from your retirement plan
Check the provisions of your retirement plan. You can borrow funds from a 401(k) plan for a down payment or make a withdrawal from an Individual Retirement Account. Be sure you understand the tax consequences, repayment terms and/or possible early withdrawal penalties.

Gift from Family
Parents and other family members are often anxious to help children buy their first home and may have the means to give you a gift of money for a portion or all of your down payment.

Documenting Your Down Payment
Documenting that the down payment comes from your savings and that you will have savings and/or assets over and above the down payment gives the lender confidence in your strength as a borrower and your ability to repay the loan. Take extra care to document the sources for any monies to be used for the down payment or closing costs.

·         Cash in a bank account

·         Mutual funds / stocks / IRA / 401K

·         Proceeds from the sale of another property

·         Gift from an immediate relative

This information has been provided as a service. Since every situation varies, it is strongly advised to seek counsel from independent tax advisors, tax attorneys, and/or CPA.










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