Funding your down payment

Home Buying

When you’re starting out on your homebuying journey, your home loan officer will ask how much of a down payment would you like to contribute and where are the funds coming from?

While many homebuyers believe they need to place 20% down on their home purchase, in today’s market there are a variety of options for low- or no-down payment financing. It’s a good idea to discuss with your home loan officer which options work best for your financial situation.

Once you’ve determined the amount, you’ll also need to identify where the funds are coming from. Some assets may need longer than others to access and it’s helpful to determine ahead of time which funds will be used.

Here are some ways to help fund your down payment: 


Savings accounts are a great place to start if you’ve been saving up towards a home purchase. Remember to exclude any funds that are earmarked for other purchases or financial goals.  

Gifts from eligible donors1

Depending on your loan type, you may be able to use gift funds from an eligible source. Most loan types require that the funds be a true gift—meaning there is no expectation of repayment. And some sources, such as a gift from a real estate agent or builder, are ineligible. You can learn more about gift funds here.

Tax refund

If you’re eligible for a tax refund, this could be a great way to source some extra funds. Consider placing your refund in a savings account where you won’t be tempted to use it until your home purchase.

Down payment assistance programs1

Many local and state governments or other organizations, offer down payment assistance programs to help eligible homebuyers with their home purchase. They may distribute the funds as a grant or a low-interest second loan. While some programs focus specifically on first-time homebuyers, there are also programs based on location, income, and other factors. The amount of funds and eligibility varies by program so make sure to check with your loan officer to see which program may be a good fit for you.

Investment or 401K accounts2

If you have an investment or a 401K account, you may be able to use those assets towards your home purchase. These types of funds may take longer than other accounts to access, so it’s a good idea to learn ahead of time how and when you can use them. It’s also recommended that you consult with a financial advisor as using funds from an investment or 401K account could have tax or other financial implications.

Interested in learning more about down payment options? Contact an Evergreen loan officer near you.

  1. Restrictions and limitations apply. Please ask for details.
  2. Restrictions and limitations apply. Please ask for details. Consult with a financial advisor on the financial and tax implications of selling investments or borrowing on a 401K plan.
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