What's The Difference Between The Deposit and Down Payment?
If you are new to the home-buying world, you may have heard the terms deposit and down payment mentioned a time or two. But did you understand the difference? When I bought my first home, it took me a minute to realize what the difference was. Hopefully, I can help you before you get too far into the home-buying process!
What is the Deposit?
The Deposit funds are what you provide with your offer to purchase. These funds are held in trust by the listing real estate brokerage and are later credited toward the total Down Payment at closing.
EX. $10,000 Deposit Amount + $20,000 In Savings = $30,000 Down Payment Amount
What is the Down Payment?
The Down Payment is the money you are putting towards the purchase. The mortgage makes up the rest of the funds required to purchase a property. These funds would be due at closing and are provided to your lawyer.
EX. $500,000 Purchase price - $30,000 Down payment = $470,000 Mortgage Amount
For more information on mortgages and down payments, check out the ladies at Laframboise Mortgages https://www.laframboisemortgage.ca/
Check Out Another Post Market Education – First Time Home Buyer
CENTURY 21 United Realty Inc. Brokerage
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CENTURY 21 United Realty Inc. Brokerage
387 George Street South (PO Box 178), Peterborough, ON K9J6Y8
(705) 743-4444
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