Why Buyers Get Confused
Imagine you're buying a $500,000 home with a $50,000 down payment.
It is easy to think: "I need $50,000."
But the transaction may also include:
- Lender fees
- Title and escrow charges
- Prepaid homeowners insurance
- Property-tax adjustments
- Initial escrow deposits
- Appraisal or other expenses
- HOA-related charges
At the same time, you may receive credits for:
- Earnest money already deposited
- Seller concessions
- Lender credits
- Other transaction adjustments
All of those numbers eventually produce your actual cash-to-close amount.
Simple Example
- Purchase price: $500,000
- Down payment: $50,000
- Illustrative closing/prepaid expenses: $12,000
- Earnest money already deposited: $10,000
- Seller credit: $5,000
- Simplified remaining cash to close: approximately $47,000
That example is purely educational. Actual settlement accounting can include many additional items.
WHERE DO YOU FIND THE OFFICIAL NUMBER?
Your lender's Loan Estimate provides an early estimate.
Later, your Closing Disclosure provides updated final loan and closing information.
Escrow/title will also prepare settlement figures for the transaction.
Do Not Wire Based on an Old Estimate
This is critical.
Never say: "My lender told me three weeks ago that I needed about $42,000, so I wired $42,000."
Obtain the current verified amount from the appropriate closing party.
And independently verify wiring instructions using a trusted phone number. See the wire-verification guide for how.
What if I Don't Have Enough?
Tell Lisa and the lender immediately.
Depending on timing and circumstances, potential options might include:
- Properly documented gift funds
- Seller concessions
- Lender credits
- Different financing
- Adjusting down payment
- Other verified assets
Not every option works for every loan.
How Lisa Helps
Lisa can help negotiate the real-estate side of cash-to-close planning, especially seller credits and contract terms.
Your lender calculates financing.
Escrow/title calculates settlement.
Together, those pieces determine what you actually need.
