down payment

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Down Payment

A percentage of the total purchase price of an item that is proffered when the item is bought on credit.

In an installment sales agreement, a buyer is required to pay part of the total price, usually in cash, and later pays the balance through a number of regularly scheduled payments.

A down payment is sometimes known as earnest money, or a sum of money that a buyer pays upon entering a contract to indicate a Good Faith intention as well as an ability to pay the balance.

down payment

noun collateral, deposit, installment, payment, retainer, stake, surety
See also: deposit, handsel, installment
References in periodicals archive ?
A downpayment which gives the borrower an immediate, substantial interest in the property;
NMHC analysis of HUD data shows, however, that risk-based premiums will not protect the FHA because households with the highest credit scores required by the bill are still twice as likely to default if they use seller-financed downpayment assistance.
Of all these explanations, the most plausible one is that innovations in the financial markets increased access to mortgage finance, mainly by reducing downpayment constraints and allowing younger people to buy homes.
FHA and VA borrowers differ from conventional loan borrowers because HUD and the VA generally allow borrowers to have more debt relative to income and to make smaller downpayments than do conventional lenders.
The Grant is provided by the Penobscot Indian Nation and is available to anyone purchasing a home that needs downpayment assistance.
FHA permits homebuyers to use gifts from family members and non-profit groups to make their entire downpayment, while conventional loans generally require homeowners to come up with a portion of the downpayment from their own funds.
It's a combination that has enormous appeal to people who have been shut out of the traditional housing market because they are unable to meet conventional downpayment and closing requirements.
For first-time buyers making very small downpayments (about three percent), the affordable price is close to the loan amount for a given income.
The contract contained the usual provision that required the downpayment of ten percent to be made by check subject to collection.
2 percent of the income needed to purchase a typical starter home with a 10 percent downpayment.
This can include tax breaks like allowing IRA money to be used for downpayments or creating housing bonds, or a savings-bond like instrument that would allow people to defer taxes while saving up for a new-home purchase.
However, many buyers are making smaller downpayments than assumed by the index, and are using loans that give them more buying power.