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 ?
The first programme enables you to pay over six months with a EGP 2,876 payment each month without a down payment.
The trend towards lower down payments could lead to an eventual decline in asset quality and a rise in credit costs, particularly to the extent that it results in companies providing finance to lower quality borrowers.
Making a smaller down payment often means facing higher mortgage insurance costs, she said, so it's no surprise renters are turning to friends and family members for down payment assistance.
According to new analysis from Realty Trac, the share of buyers using low down payment loans dropped to an 11-year low in 2014.
According to the results of a recent survey conducted by Zelman & Associates, 39 percent of those surveyed estimated that the minimum down payment requirement for a home is at least 15 percent of the purchase price.
Because the rules of gifting are relatively simple, and because down payments remain a struggle for younger buyers, Mondello expects gifting to become an even more common event.
Down payments also solve some problems for lenders.
From down payment assistance plans to credit workshops, home buying initiatives are sprouting up everywhere.
Mortgage guaranty insurance, also known as private mortgage insurance, allows borrowers to own a home without the need for a high down payment.
9) For example, the FHA insures mortgages that require smaller down payments and, unlike PMI companies, allows the borrower to finance closing costs.
Historically, low homeownership rates across nearly every age demographic have led to a public policy push to lower the barrier to homeownership through down payments as low as 3%, according to Daren Blomquist, vice president at RealtyTrac.