I thought lender can't contribute toward FHA down payment? (loan, credit, loan)
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From everything I've read, the the 3.5% down payment on an FHA loan has to come solely from the borrower (gift funds excluded). So on our house purchase of $306,410, the down payment of 3.5% should be $10,725. They are only asking for $10,225 ($2725 due at closing +$7,500 in earnest deposit we've previously given them). All other closing costs are paid by the lender/builder.
How can this be? Seems like a mistake in our favor but can it come back and bite us in the butt later?
What are they doing with the $500 prepaid appraisal fee?
That is likely being credited, but not refunded, meaning it's converted to down payment money, so you've already paid $500 toward the down payment, meaning your bottom line due is $500 less.
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