A down payment is the money you put down on your loan to meet the program requirements but don't confuse a down payment with closing costs.
Closing costs are the costs you are going to incur to get that mortgage. This is above and beyond the down payment. Here are some of the common closing costs that you can expect to pay.
Appraisal fees
Lender Fees
Discount Points
Title Fees
Property Tax and House Insurance Escorws
Attorney Fee (Optional)
Discount Points are a fancy word for an extra fee that is added to your closing costs and used to buy a lower interest rate. The common jargon used is 1 point or 2 points. When referencing 1 point your lender is charging you a fee of 1% of the loan amount to buy a lower rate. Two points would be a 2% fee. You can always buy a lower interest rate if you are willing to pay the cost but it doesn't always make sense.
**All of the costs above should be discussed in detail with your lender.
